A Unit Trust Is a Passive Investment That Holds a Fixed

question 46

True/False

A unit trust is a passive investment that holds a fixed portfolio of securities such as federal government bonds.

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Definitions:

Corporate Debt

Borrowed money that a company owes to creditors, which can be in the form of bonds, loans, or other debt instruments.

Financial Intermediation

The process by which financial institutions such as banks mediate or stand between savers and borrowers to facilitate financial transactions.

Financial Institution

An organization that provides financial services to its clients or members, such as banking, investing, and insurance.

Stocks and Bonds

Securities representing equity ownership in a corporation (stocks) and debt obligations of an entity (bonds), each offering different risk and return profiles.