Unit study guide · NISM Series II-B
Mutual Fund Products
12 questions in this unit
What this unit covers
- Which plan generally excludes embedded distributor commission?
- Which document describes a particular scheme's investment objective and key features in detail?
- What is the main purpose of the Riskometer for a mutual fund scheme?
- A fund mainly invests in shares of listed companies. Which broad category best describes it?
- Which scheme mainly invests in fixed-income securities?
- Which scheme combines equity and fixed-income exposure according to its mandate?
- Which scheme is normally offered for subscription and redemption continuously at applicable NAV?
- What is the main purpose of a Key Information Memorandum?
- An investor selects a scheme without reviewing its investment objective. Which risk arises?
- Which document contains additional general information about the mutual fund and service arrangements?
- Two plans share the same scheme portfolio but charge different expense rates. What primarily explains different NAV paths?
- An interval scheme permits repurchases only in stated windows. Which feature should an investor check first?
Key ideas
From the practice bank · 1
Which plan generally excludes embedded distributor commission?
A direct plan does not include the distribution commission associated with a regular plan.
Hint Think about how the investor accesses the scheme.
II-B-080From the practice bank · 2
Which document describes a particular scheme's investment objective and key features in detail?
The Scheme Information Document sets out the scheme's features, objective and principal terms.
Hint Think about the scheme-specific offer information.
II-B-081From the practice bank · 3
What is the main purpose of the Riskometer for a mutual fund scheme?
The Riskometer presents the scheme's risk classification to help investors understand risk exposure.
Hint Consider how risk is shown to prospective investors.
II-B-082From the practice bank · 4
A fund mainly invests in shares of listed companies. Which broad category best describes it?
An equity-oriented mutual fund primarily invests in equity securities within its disclosed mandate.
Hint Focus on the dominant investment asset class.
II-B-083From the practice bank · 5
Which scheme mainly invests in fixed-income securities?
A debt fund principally invests in debt or money-market instruments according to its objective.
Hint Think about bonds and other borrowing instruments.
II-B-084From the practice bank · 6
Which scheme combines equity and fixed-income exposure according to its mandate?
A hybrid fund combines asset classes such as equity and debt under its disclosed strategy.
Hint Look for a mixed-asset investment approach.
II-B-085From the practice bank · 7
Which scheme is normally offered for subscription and redemption continuously at applicable NAV?
An open-ended mutual fund generally permits ongoing subscriptions and redemptions under its terms.
Hint Think about ongoing unit entry and exit.
II-B-086From the practice bank · 8
What is the main purpose of a Key Information Memorandum?
The Key Information Memorandum summarises important information about the scheme for investors.
Hint Think about a shorter investor-facing summary.
II-B-087From the practice bank · 9
An investor selects a scheme without reviewing its investment objective. Which risk arises?
Ignoring the investment objective can lead to selecting a product with unsuitable underlying exposure.
Hint Match the product mandate to the intended purpose.
II-B-088From the practice bank · 10
Which document contains additional general information about the mutual fund and service arrangements?
The Statement of Additional Information contains broader information about the mutual fund organisation and operations.
Hint Distinguish general fund information from scheme-specific terms.
II-B-089From the practice bank · 11
Two plans share the same scheme portfolio but charge different expense rates. What primarily explains different NAV paths?
Plans holding the same portfolio may have different NAV progression because their expenses differ.
Hint Think about identical assets with different deductions.
II-B-090From the practice bank · 12
An interval scheme permits repurchases only in stated windows. Which feature should an investor check first?
An interval fund's specified subscription and redemption windows control practical .
Hint Consider when money can actually be withdrawn.
II-B-091Liquidity in the stock market means how easily a quantity can be bought or sold.
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