n NISM Certifications
X NISM Series X
Medium

Which two costs influence portfolio rebalancing decisions?

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

    Taxes and general expenses

  2. B

    Bid-ask spread and taxes

  3. Transaction costs and taxes

    Correct answer

  4. D

    Research costs and transaction costs

Why this is the answer

Portfolio rebalancing decisions consider transaction costs such as brokerage and bid-ask spreads, along with tax costs arising from the sale of securities.

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