NISM Exam Preparation

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Chapter 11: Mutual Fund Scheme Selection

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11.1: Scheme Selection based on Investor needs, preferences and risk-profile

🎯 Understanding Your Investment Goals

  • Every investor has unique financial needs:

    • - Long-term wealth growth

    - Regular income generation

    - Short-term fund parking with high liquidity

    🌟 Investment is a Journey, Not a Destination

  • Your investment portfolio is a tool to achieve specific life goals:

    • - Building wealth for the future

    - Funding children's education

    - Planning for retirement

    📊 Risk Profile Matters

  • Your risk appetite depends on three key factors:

    • - Need to take risks

    - Ability to take risks

    - Willingness to take risks

    💡 Key Takeaway: Understand your personal financial situation before selecting any mutual fund scheme

    Practice Questions

    1. Which of the following is NOT a key factor in determining an investor's risk appetite?

    2. An investment portfolio is primarily a means to:

    3. What is the most critical aspect of risk profiling?

    11.2: Asset Allocation: Matching Investments to Your Goals

    11.3: Focused and Sector Funds: Specialized Investment Strategies

    11.4: Growth and Value Funds: Different Investment Philosophies

    11.5: International Equity Funds: Global Diversification

    11.6: Debt Fund Strategies: Navigating Fixed Income Investments

    11.7: Matching Fund's Portfolio with its Investment Objective

    11.8: Fund Manager: The Key Decision Maker

    11.9: Fund Age and Size: Understanding the Implications

    11.10: Portfolio Turnover: Understanding Trading Frequency

    11.11: Income Distribution and Withdrawal Options

    11.12: Practice Questions