Advantages of Investing in Mutual Funds Include All of the Following

question 48

Multiple Choice

Advantages of investing in mutual funds include all of the following, except

• A) diversification of your investment.
• B) professional management.
• C) meeting specific investment goals.
• D) there is virtually no risk of loss.

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Definitions:

Supernormal Growth

A period in which a company or economy experiences growth rates significantly above the norm.

Dividend Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its stock price, indicative of the return on investment for shareholders.

Capital Gains Yield

The capital gain on a stock divided by the price at which it was purchased.

Future Earnings

Expected future profits of a company, often used to assess its valuation or the potential return on investment.