n NISM Certifications
X NISM Series X
Medium

When recommending between Index Funds and Actively Managed Funds, what should an adviser consider?

Practice question from NISM Series XB- Investment Adviser (Level 2) Mock Test 4 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Cost of management

  2. B

    Potential for higher returns

  3. Suitability to client’s investment objectives

    Correct answer

  4. D

    All of the above

Why this is the answer

The choice depends on the client’s goals, risk appetite, and investment horizon, aligning with their specific needs.

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