n NISM Certifications
X NISM Series X
Medium

Which investment behavior exemplifies rational decision-making?

Practice question from NISM Series XB- Investment Adviser (Level 2) Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Considering random wins as investment skill

  2. B

    Investing in stocks instead of companies

  3. Diversifying across multiple industries

    Correct answer

  4. D

    Panic selling during market shocks

Why this is the answer

Diversification spreads risk, aligns with rational investment principles, and is a hallmark of sound portfolio management.

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