n NISM Certifications
V-A NISM Series V-A
Medium

Which debt schemes of mutual funds invest only in debt securities where moneys will be repaid within 91 days?

Practice question from Nism VA Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Money Market Funds

  2. B

    Medium term debt funds

  3. C

    Fixed Maturity Plans

  4. Liquid Funds

    Correct answer

Why this is the answer

Liquid Fund is an open-ended liquid scheme whose investment is into debt and money market securities with a maturity of up to 91 days only. An investor seeking the lowest risk ought to go for a liquid scheme. However, the returns in such instruments are low. These schemes are suitable for investors looking for a product to park their funds for very short periods (up to 91 days).

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