Which of the Following Investments Is Characterized by Low Risk

question 289

Multiple Choice

Which of the following investments is characterized by low risk, low fees, and high historic returns when held over a lengthy time period?

• A) A managed mutual fund that has performed well during the past two or three years.
• B) A portfolio of technology stocks.
• C) A mutual fund that holds stocks in the same proportion as a broad stock market index such as the S&P 500.
• D) A mutual fund invested in medium-term bonds issued by the U.S. Treasury.

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Definitions:

Peak-to-peak

A measure of the amplitude of a waveform, indicated by the difference between its maximum and minimum values.

RMS

Root Mean Square, a statistical measure of the magnitude of a varying quantity, used especially in electrical engineering to quantify the average voltage or current of alternating current (AC).

Full-wave

A method or device that converts the entire cycle of an AC waveform into a unidirectional flow of current.

Zero

A numeral representing the absence of any quantity or value; in mathematics and physics, it is considered a point of reference.