The banking book and trading book are two different portfolios within a bank. The banking book consists of assets on the bank's balance sheet that are expected to be held until maturity. These assets are not marked to market, meaning they are usually held at historical cost. The banking book typically includes loans, mortgages, and bonds. The purpose of the banking book is to earn interest over a long period, and the risks associated with the banking book are credit risk and interest rate risk.

On the other hand, the trading book consists of assets that are available for sale, meaning that they are eligible for day-to-day trading. Under Basel II and III, the trading book has to be marked to market on a daily basis. The trading book typically includes financial instruments like government and corporate bonds, derivatives, and equities. The purpose of the trading book is to earn profits from short-term price fluctuations, and the risks associated with the trading book are market risk and liquidity risk.

Choice B is incorrect. Both the banking book and trading book consist of assets that are held on the bank's balance sheet. The distinction between them lies in their purpose and how they are managed, not where they are held.

Choice C is incorrect. While it's true that the value of assets in the trading book can fluctuate due to market variables, it's not accurate to say that all assets in the banking book have fixed values. The banking book can include loans and bonds whose values may change due to interest rate fluctuations or credit risk changes.

Choice D is incorrect. The banking book does not only show primary financial instruments such as cash; it also includes other long-term investments like loans and bonds which are expected to be held until maturity. Similarly, while the trading book may include derivative instruments, it also includes other securities intended for active trading.