n NISM Certifications
X NISM Series X
Medium

Which issue is most complex in a ‘Secondaries’ transaction of an AIF interest?

Practice question from NISM Series XIX A- Alternative Investments Funds (AIF) Distributors Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Replacing an existing manager

  2. B

    Getting SEBI approval

  3. Agreement on valuation of the transferred interest

    Correct answer

  4. D

    Approving the transfer by the AIF manager

Why this is the answer

Valuation of secondary interests is complex due to the illiquid nature of underlying assets and the need for consensus on fair value.

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