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AAFM CWM_LEVEL_2 Exam - Topic 1 Question 9 Discussion

Section C (4 Mark)Read the senario and answer to the question.You have reviewed the investments of Nimita for the purview of retirement. You advise that a balance be restored from risk perspective and accordingly Rs. 15 lakh be shifted to a Debt MF scheme. You advise to further start SIPs immediately in the ratio of 60:40 in the newly started debt MF scheme and the existing Equity MF scheme for the next 21 years to accumulate a corpus so that the same sustains for the next 25 years if invested in an investment instrument yielding 7.50%. What approximate amount of SIPs should be made in Debt and Equity MF schemes?
C) Rs. 60,000 in Debt MF scheme & Rs. 40,000 in Equity MF scheme
A) Rs. 58,000 in Debt MF scheme & Rs. 39,000 in Equity MF scheme
B) Rs. 55,400 in Debt MF scheme & Rs. 37,000 in Equity MF scheme
D) Rs. 42,000 in Debt MF scheme & Rs. 28,000 in Equity MF scheme

AAFM CWM_LEVEL_2 Exam - Topic 1 Question 9 Discussion

Actual exam question for AAFM's CWM_LEVEL_2 exam
Question #: 9
Topic #: 1
[All CWM_LEVEL_2 Questions]

Section C (4 Mark)

Read the senario and answer to the question.

You have reviewed the investments of Nimita for the purview of retirement. You advise that a balance be restored from risk perspective and accordingly Rs. 15 lakh be shifted to a Debt MF scheme. You advise to further start SIPs immediately in the ratio of 60:40 in the newly started debt MF scheme and the existing Equity MF scheme for the next 21 years to accumulate a corpus so that the same sustains for the next 25 years if invested in an investment instrument yielding 7.50%. What approximate amount of SIPs should be made in Debt and Equity MF schemes?

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Suggested Answer: C

by Kanisha at May 06, 2022, 09:44 AM

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Sabine
10 months ago
Totally agree with the 60:40 split, it’s a balanced approach!
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Anglea
11 months ago
Wait, are we really expecting 7.50% returns consistently for 25 years?
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Leonardo
11 months ago
Why not just go all in on Equity? Seems risky to split it!
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Pilar
11 months ago
I think Rs. 55,400 in Debt and Rs. 37,000 in Equity makes more sense.
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Jutta
11 months ago
Looks like Rs. 58,000 in Debt MF and Rs. 39,000 in Equity MF is the way to go!
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Hoa
11 months ago
Okay, I've got this. The European Commission is the right answer here, as they are tasked with taking appropriate steps to develop international cooperation for enforcing data protection laws.
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Candra
12 months ago
Recall a practice problem: SIPs use FV of an annuity with n=21 years at 7.5%; 60:40 split for debt/equity.
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