NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Mutual Funds
A scheme has a NAV of ₹40.00 at the start of the year. It pays a dividend (IDCW) of ₹4.00 per unit during the year, after which the NAV at year-end is ₹42.00. Ignoring reinvestment of the dividend and taxes, what is the investor's total return for the year?
The total return is 15%. The NAV rose from ₹40 to ₹42, a gain of ₹2, and the investor also received a ₹4 dividend, so total gain is ₹6 on an opening NAV of ₹40, which gives 15 percent.
- A5.0%
- B10.0%
- C15.0%Correct
- D20.0%
Explanation
Total return = (closing NAV - opening NAV + dividend) / opening NAV = (42 - 40 + 4) / 40 = 6/40 = 15%. Option 5% counts only the NAV change, and 10% counts only the dividend yield. Option 20% is not supported by the data.
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