Ch.11 · Scheme Performance Disclosure Rules · medium
What is 'concentration risk' in a mutual fund portfolio?
0% of students got this wrong
EXPLANATION
Concentration risk arises when a fund has disproportionately large exposure to a single stock, sector, or issuer. A negative event affecting that position — earnings miss, rating downgrade, regulatory issue — has an outsized impact on the fund's NAV compared to a well-diversified portfolio.
Practising Chapter 11 one question at a time?
Try the full chapter — 60 questions, tracked score, weak area breakdown.