Ch.10 · Risk Measures and Ratios · easy
What is 'credit risk' in the context of debt mutual funds?
0% of students got this wrong
EXPLANATION
Credit risk is the risk that a bond or debt instrument issuer fails to make timely interest or principal payments. When a company defaults or its credit rating is downgraded, the value of its bonds falls, reducing the debt fund's NAV. Credit rating agencies (CRISIL, ICRA, CARE) assign ratings to indicate credit risk levels.
Practising Chapter 10 one question at a time?
Try the full chapter — 100 questions, tracked score, weak area breakdown.