NISM Certifications · NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors · Collective Investment Vehicles
An investor puts Rs 10,00,000 in a pooled vehicle. After one year the value is Rs 11,50,000, and the vehicle charged no further costs beyond those already reflected in this value. What is the percentage return for the year?
The return is 15 percent. The gain is Rs 1,50,000, which is the ending value of Rs 11,50,000 minus the invested Rs 10,00,000, and dividing this gain by the initial investment of Rs 10,00,000 gives 15 percent.
- A13.0%
- B15.0%Correct
- C11.5%
- D10.0%
Explanation
Return = (11,50,000 - 10,00,000) / 10,00,000 = 1,50,000 / 10,00,000 = 15%. Check: 10,00,000 x 1.15 = 11,50,000. Using 11.5% mistakenly divides the ending value by 1 crore-like base or confuses ratio with return.
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