NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Net Asset Value, Total Expense Ratio and Pricing of Units
A mutual fund scheme with an exit load of 1% if redeemed within 12 months has a NAV of ₹40.00 on the redemption day. An investor redeems 500 units after 7 months. What amount will be paid out, ignoring taxes and other charges?
The investor receives ₹19,800. The redemption is within 12 months, so the 1% exit load applies. Gross value is 500 units times ₹40, which is ₹20,000. Deducting the ₹200 load leaves ₹19,800.
- A₹19,800Correct
- B₹20,000
- C₹19,600
- D₹20,200
Explanation
Gross redemption value = 500 × 40 = ₹20,000. Exit load = 1% of 20,000 = ₹200. Net payout = 20,000 − 200 = ₹19,800. ₹20,000 ignores the load, and ₹20,200 wrongly adds it.
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