NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Mutual Funds
Meera invests Rs 60,000 in a scheme at an NAV of Rs 40 per unit with no entry load. After one year she redeems all units at an NAV of Rs 46. Ignoring taxes and exit load, what is her absolute return?
Her absolute return is 15%. She buys 1,500 units at Rs 40 and redeems them at Rs 46, so the value rises from Rs 60,000 to Rs 69,000. The gain of Rs 9,000 divided by the Rs 60,000 invested gives 15%.
- A13%
- B15%Correct
- C18%
- D20%
Explanation
Units bought = 60,000/40 = 1,500. Redemption value = 1,500 x 46 = Rs 69,000. Gain = 9,000, so return = 9,000/60,000 = 15%. Equivalently (46-40)/40 = 15%. 13% and 18% come from using wrong bases.
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