Which of the Following Is Not the Difference Between Hedge

question 41

Multiple Choice

Which of the following is not the difference between hedge funds and mutual funds?

• A) Mutual funds are registered with the SEC, while hedge funds are not.
• B) Unlike mutual funds, hedge funds borrow significant amounts of their capital.
• C) Unlike mutual funds, hedge funds concentrate their investment in very few areas.
• D) Unlike mutual funds, hedge funds are managed by professional fund managers.

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Definitions:

Six-Month

Relating to or denoting a period or term of six months, often used in the context of time-specific agreements or conditions.

Debentures

A type of debt instrument not secured by physical assets or collateral but backed only by the general creditworthiness and reputation of the issuer.

Unsecured Debt

Unsecured debt refers to loans or credits not backed by collateral, meaning the lender relies on the borrower's promise to pay back the debt.

Securities

Financial instruments that represent ownership positions, debts, or rights to ownership, such as stocks, bonds, and options.