When Testing Mutual Fund Performance Over Time One Must Be

question 35

Multiple Choice

When testing mutual fund performance over time one must be careful of ___________,which means that a certain percentage of poorer performing funds fail over time which makes the performance of remaining funds seem more consistent over time.

• A) survivorship bias
• B) lucky event bias
• C) magnitude bias
• D) mean reversion bias

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Definitions:

High-crime Neighborhood

An area with significantly higher rates of crime compared to other areas, often impacting the community's quality of life.

Examination

An assessment method used to measure a person's knowledge, skills, or physical condition.

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The natural physical and chemical functions or activities within living organisms that support life, such as metabolism, respiration, and reproduction.

Endocrine

Pertaining to glands that release hormones directly into the bloodstream, influencing various bodily functions and processes.