Which of the Following Is True About Index Funds

question 64

Multiple Choice

Which of the following is true about index funds?

• A) They consistently outperform 75% of actively managed funds.
• B) They make no effort to select the best performing stocks.
• C) They consistently underperform 75% of actively managed funds.
• D) They outperform the market by selling the weakest companies in the index and weighting the strongest companies more heavily.

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Definitions:

Memory Trace

A theoretical concept referring to the physical change in the brain, presumably involved in storing a piece of information or memory.

Physical Change

A change in which the form or appearance of matter changes but not its chemical composition.

Anterograde Amnesia

A condition affecting memory, where new events post-trauma or onset cannot be committed to long-term memory.

Retrograde Amnesia

A loss of memory-access to events that occurred, or information that was learned, before an injury or the onset of a disease.