Multiple choice

For an open ended scheme, the repurchase price can not be

  1. lower than 93% of the NAV

  2. lower than 93% of the Sale price

  3. both (a) and (b)

  4. None of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

For open-ended schemes, SEBI regulations prescribe that repurchase price cannot be lower than 93% of NAV and also cannot be lower than 93% of the sale price. These are two separate constraints that both apply to protect investors. The regulations ensure that investors receive fair value when redeeming their units. Either constraint alone would be insufficient.

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