n NISM Certifications
X NISM Series X
Medium

Why is it risky to invest in a Real Estate debt fund?

Practice question from NISM Series XA- Investment Adviser (Level 1) Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    These funds have very low credit rating

  2. B

    These funds have high risk of litigation due to violation of law

  3. C

    These funds are subject to high taxation

  4. These funds carry higher risk of default when projects are stuck in construction phase

    Correct answer

Why this is the answer

Projects that get stuck in construction pose a default risk for real estate debt funds.

Test yourself for real

Take a full NISM Series X mock test.

Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.