Dividends paid by mutual funds can be distributed out of
A
Profits of the Asset Management Company
B
Mark-to-market profits
C
All realized and unrealized gains
D
Distributable surplus only
Correct Option:
D
Explanation
Mutual funds can distribute dividends, now referred to as Income Distribution cum Capital Withdrawal (IDCW), only from the distributable surplus of the scheme. They cannot be paid from the AMC's profits or from unrealized gains.
