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What does a mutual fund that invests in short-term, low-risk securities is known as?  A. Growth fund  B. Equity fund  C. Income fund  D. International fund

Question

What does a mutual fund that invests in short-term, low-risk securities is known as?  A. Growth fund  B. Equity fund  C. Income fund  D. International fund

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Solution

The mutual fund that invests in short-term, low-risk securities is known as C. Income fund.

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WHAT IS A MUTUAL FUND? A. A way to buy a single stock in a company. B. A way to buy a bundle of securities all at once. C. A way to buy a single bond from a government agency. D. A way to buy shares directly from a stock exchange.WHAT IS THE MAIN ADVANTAGE OF USING MUTUAL FUNDS? A. They charge lower fees than ETFs. B. They allow you to customize your portfolio holdings. C. They automatically pass through dividends to shareholders. D. They provide better returns than individual stocks.WHAT IS THE BIGGEST DISADVANTAGE OF USING MUTUAL FUNDS? A. They require frequent attention from investors. B. They cannot be bought or sold on the open market. C. They do not diversify investments. D. The current value of invested capital.WHAT IS THE DIFFERENCE BETWEEN OPEN-ENDED AND CLOSED-ENDED MUTUAL FUNDS? A. Open-ended funds have a fixed number of shares, while closed-ended funds do not. B. Open-ended funds can be bought and sold on the open market, while closed-ended funds cannot. C. Closed-ended funds have a fixed number of shares, while open-ended funds do not. D. Closed-ended funds can be bought and sold on the open market, while open-ended funds cannot.WHAT IS THE MAIN DIFFERENCE BETWEEN ETFS AND MUTUAL FUNDS? A. ETFs have lower fees than mutual funds. B. ETFs are actively managed, while mutual funds are not. C. ETFs hold a wide range of assets, while mutual funds only hold a single asset. D. Mutual fund purchases are done once day after the market has closed.

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