Ch.3 · Custodian and RTA Functions · easy
What is the 'nominee' registration in a mutual fund folio and its importance?
0% of students got this wrong
EXPLANATION
Nomination allows a unit holder to designate up to 3 nominees who will receive the mutual fund units or redemption proceeds upon the unit holder's death. This facilitates transmission of assets without lengthy probate/succession procedures. The nominee's right arises only on the investor's death — during lifetime, the investor retains full control. SEBI has mandated nomination (or explicit opt-out) for all folios.
Practising Chapter 3 one question at a time?
Try the full chapter — 80 questions, tracked score, weak area breakdown.