c) True

Mutual funds indeed help in diversification of investment. Here's why:

1. Variety of Securities: Mutual funds invest in a wide variety of securities such as stocks, bonds, and other assets. This means that the risk is spread across multiple securities, reducing the impact of a single security's poor performance on the overall portfolio.

2. Professional Management: Mutual funds are managed by professional fund managers who have the expertise and resources to research and select securities to achieve the fund's investment objectives. This can lead to better diversification than an individual investor might achieve on their own.

3. Accessibility: Mutual funds allow investors to achieve diversification with a relatively small amount of money. This is because they pool money from many investors to buy a broad mix of securities.

So, mutual funds can be a useful tool for investors looking to diversify their portfolios.

Question

c) True

Mutual funds indeed help in diversification of investment. Here's why:

1. Variety of Securities: Mutual funds invest in a wide variety of securities such as stocks, bonds, and other assets. This means that the risk is spread across multiple securities, reducing the impact of a single security's poor performance on the overall portfolio.

2. Professional Management: Mutual funds are managed by professional fund managers who have the expertise and resources to research and select securities to achieve the fund's investment objectives. This can lead to better diversification than an individual investor might achieve on their own.

3. Accessibility: Mutual funds allow investors to achieve diversification with a relatively small amount of money. This is because they pool money from many investors to buy a broad mix of securities.

So, mutual funds can be a useful tool for investors looking to diversify their portfolios.

Knowee AI · Accepted Answer

c) True

Mutual funds indeed help in diversification of investment. Here's why:

1. Variety of Securities: Mutual funds invest in a wide variety of securities such as stocks, bonds, and other assets. This means that the risk is spread across multiple securities, reducing the impact of a single security's poor performance on the overall portfolio.

2. Professional Management: Mutual funds are managed by professional fund managers who have the expertise and resources to research and select securities to achieve the fund's investment objectives. This can lead to better diversification than an individual investor might achieve on their own.

3. Accessibility: Mutual funds allow investors to achieve diversification with a relatively small amount of money. This is because they pool money from many investors to buy a broad mix of securities.

So, mutual funds can be a useful tool for investors looking to diversify their portfolios.

Do Mutual Funds help in Diversification of investment?2 pointsa) Not at allb) May Bec) TrueFalse

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