Asked by Jeancarlos Chavarro on Jun 11, 2024
Verified
Most professionally managed equity funds generally
A) outperform the S&P 500 Index on both raw and risk-adjusted return measures.
B) underperform the S&P 500 Index on both raw and risk-adjusted return measures.
C) outperform the S&P 500 Index on raw return measures and underperform the S&P 500 Index on risk-adjusted return measures.
D) underperform the S&P 500 Index on raw return measures and outperform the S&P 500 Index on risk-adjusted return measures.
E) match the performance of the S&P 500 Index on both raw and risk-adjusted return measures.
S&P 500 Index
The S&P 500 Index is a market-capitalization-weighted index of 500 of the largest publicly traded companies in the U.S., widely regarded as one of the best indicators of U.S. stock market performance.
Risk-Adjusted Return
A measure of the return on an investment portfolio that has been adjusted for the risk the investor has taken, providing a more accurate depiction of the portfolio's performance.
- Distinguish between mutual funds, hedge funds, and equity funds in terms of performance and risk characteristics.
Verified Answer
JB
James BauerJun 16, 2024
Final Answer :
B
Explanation :
Most mutual funds do not consistently, over time, outperform the S&P 500 Index on the basis of either raw or risk-adjusted return measures.
Learning Objectives
- Distinguish between mutual funds, hedge funds, and equity funds in terms of performance and risk characteristics.