Asked by Sewar Rawabdeh on Apr 27, 2024
Verified
The type of mutual fund that primarily engages in market timing is called ________.
A) a sector fund
B) an index fund
C) an ETF
D) an asset allocation fund
Market Timing
An investment strategy where the investor tries to predict future market movements to buy low and sell high.
Asset Allocation Fund
A mutual fund that spreads its investments across various asset classes, aiming to reduce risk through diversification.
Sector Fund
A mutual fund that invests exclusively in a particular sector of the economy, such as technology, health care, or finance.
- Grasp the concept and purpose of different types of mutual funds including their strategies regarding market timing and the extent of regulatory oversight.
Verified Answer
SP
Shilvi PatelMay 01, 2024
Final Answer :
D
Explanation :
Asset allocation funds primarily engage in market timing, shifting assets among stocks, bonds, and cash equivalents to take advantage of market conditions.
Learning Objectives
- Grasp the concept and purpose of different types of mutual funds including their strategies regarding market timing and the extent of regulatory oversight.