n NISM Certifications
X NISM Series X
Medium

When an adviser receives a commission from product sales, what is the appropriate action?

Practice question from NISM Series XA- Investment Adviser (Level 1) Mock Test 7 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Disclose it only if asked

  2. B

    Omit disclosure as unimportant

  3. C

    Treat it as unrelated income

  4. Disclose it to the client

    Correct answer

Why this is the answer

Transparency requires advisers to disclose any commissions to maintain trust and comply with regulations.

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