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Ch.2 · Mutual Fund Structure Basics · hard

What is a Dividend Yield fund as per SEBI categorisation?

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EXPLANATION

A Dividend Yield fund must invest minimum 65% of total assets in dividend-yielding stocks. SEBI does not prescribe a specific dividend yield threshold — the fund manager selects stocks with a focus on dividend yield as an investment strategy.

A.A fund that only invests in companies that have paid dividends for 10+ consecutive years

B.A fund that must invest minimum 65% in dividend-yielding stocks [✓ Correct]

C.A debt fund that pays monthly dividends to investors

D.A fund that invests in stocks with dividend yield above 5%

EXPLANATION

A Dividend Yield fund must invest minimum 65% of total assets in dividend-yielding stocks. SEBI does not prescribe a specific dividend yield threshold — the fund manager selects stocks with a focus on dividend yield as an investment strategy.

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