NISM V-C Legal and Regulatory Environment — Practice Questions
Practise the legalities Level 2 adds — real estate mutual funds, REITs and InvITs, investment restrictions on scheme portfolios, and the process for changing a fund's or a scheme's structure.
37 questions on Legal & Regulatory in the ScoreSetu bank — each with a detailed explanation and, where useful, a memory hook.
What this topic covers
- Regulation of REITs and InvITs
- Investment restrictions
- Changes in fund or scheme structure
- Alternate distribution channels
Free sample questions
1. A Real Estate Mutual Fund can __________ .
- A. invest in a project under construction if all municipality permissions are received
- B. provide housing loans
- C. lease out the real estate assets held by the real estate mutual fund scheme ✅
- D. All of the above
Answer: C — lease out the real estate assets held by the real estate mutual fund scheme
Why: Real Estate Fund can invest in only completed projects and cannot give housing loans. The asset management company may let out or lease out the real estate assets held by the real estate mutual fund scheme if the term of such lease or letting does not extend beyond the period of maturity of the scheme.
💡 REMF CAN lease out its real estate (within scheme maturity); can't give housing loans or buy under-construction.
2. A Real Estate fund has to be _________ fund
- A. Close Ended ✅
- B. Open Ended
- C. Interval
- D. None of the above
Answer: A — Close Ended
Why: Every real estate mutual fund scheme has to be close-ended and its units are to be listed on a recognized stock exchange.
💡 Every Real Estate MF scheme must be CLOSE-ENDED and listed on a stock exchange.
3. With respect to Real Estate Mutual Funds, a Real Estate Asset does not include which of the following?
- A. vacant land
- B. deserted property
- C. project under construction
- D. All of the above ✅
Answer: D — All of the above
Why: “Real estate asset” means an identifiable immovable property but it does not include- I. a project under construction; or II. vacant land; or III. deserted property; or IV. land specified for agricultural use; or V. a property which is reserved or attached by any Government or other authority or pursuant to orders of a court of law or the acquisition of which is otherwise prohibited under any law for the time being in force.
💡 REMF 'real estate asset' EXCLUDES under-construction projects, vacant land, deserted property & agri land.
Practise all 37 Legal & Regulatory questions
Plus the full 340-question NISM V-C bank and real-feel mock exams.