Assume That a Stock Mutual Fund Uses Stock Index Futures

question 1

Multiple Choice

Assume that a stock mutual fund uses stock index futures as it conducts dynamic asset allocation. This means that the mutual fund

• A)liquidates all of its stock holdings whenever it expects a market downturn.
• B)maintains a constant buy position in stock index futures.
• C)maintains a constant sell position in stock index futures.
• D)None of these are correct.

---

Definitions:

Intellectual Disability

"A condition of limited mental ability in which an individual has a low IQ, usually below 70 on a traditional intelligence test, and has difficulty adapting to everyday life."

Limited Mental Ability

A state or condition where an individual's cognitive functions are below average and restrict daily activities and learning capacity.

Everyday Life

Pertains to daily activities, routines, behaviors, and interactions across various contexts and environments.

Organic Intellectual Disability

An intellectual disability caused by physical damage to the brain or abnormal brain development, resulting in cognitive impairments.