All categories

3 years ago

Why do some people consider mutual funds a more convenient investment than stocks or bonds?

Business

2 answers:

stich3 [128]3 years ago

7 0

Answer:

People consider mutual funds a more convenient investment than stocks or bonds because of the following:

1. Mutual fund is less risky compared to stocks or bonds

2. There is comparatively higher returns compared to stocks or bonds

3. Mutual funds are managed by experts compared to stocks or bonds

4. Liquidity

5. Mutual funds are convenient compared to stocks or bonds

Explanation:

Mutual fund is an investment whereby funds are mobilized from different investors to buy shares, stocks, bonds of different entities operating in different industries.

The total investment is known as a portfolio. Such investment is managed by experts known as portfolio managers.

1. Mutual Fund is Less Risky Compared to Stocks or Bonds

Unlike stocks or bonds, mutual funds invest in securities of varying risks thereby diversifying the entire portfolio.

2. There is Comparatively Higher Returns compared to Stocks or Bonds

Unlike stocks or bonds, mutual funds invest in different industries and sectors thereby ensuring some stability and high returns

3. Mutual Funds are Managed by Experts Compared to Stocks or Bonds

Mutual funds are managed by skilled individual who are highly knowledgeable about the market, but such skill may be lacking for individual investors who wants to invest in stocks or bonds.

4. Liquidity - Mutual funds enjoy some degree of liquidity as they are allowed to buy or sell their share of the fund once a day at the close of the market at the fund’s net asset value

5. Mutual Funds are Convenient Compared to Stocks or Bonds

Unlike stock and bonds you do not need to do personal research before investment with mutual fund. stock monitoring is done by the fund manager.

MAXImum [283]3 years ago

4 0

I think because in a mutual they both gain and invest but on their own its too much

You might be interested in

Federal antitrust statutes are complex, but the basic goal is straightforward: to prevent a major industry from being so dominat

wolverine [178]

Answer:

Many observer says it does

Explanation:

This is because certain or few group of owners would dominate the industry and also won it, they would control how new owners enter into the game

6 0

3 years ago

Arktec manufacturing must choose between the following two capacity options:

Svetlanka [38]

Answer:

See below

Explanation:

A. The cost for each for each option;

•If demand level is 25,000 units per year

Option 1 = $500,000 + ($2 × 25,000 unit

= $500,000 + $50,000

= $550,000

Option 2 = $100,000 + ($10 × 25,000 units)

= $100,000 + $250,000

= $350,000

• If the demand level is 75,000 units per year

Option 1 = $500,000 + ($2 × 75,000 units)

= $500,000 + $150,000

= $650,000

Option 2 = $100,000 + ($10 × 75,000 units)

= $100,000 + $750,000

= $850,000

B. As the volume level increases, option 1 will be better since the variable cost is lower. As the volume decreases, option 2 will be better as the fixed cost is lower.

C. The indifference point

= Differential fixed cost/Differential variable cost per unit

= [$500,000 - $100,000]/[$10 -$2]

= $400,000/$8

= 50,000 units

5 0

3 years ago

Tangshan Industries has issued a bond which has a $1,000 par value and a 15 percent annual coupon interest rate. The bond will

mina [271]

Answer:

B. 10.79 percent

Explanation:

yield to maturity = [150 + (1250 - 1000/10)]/[(1250 + 1000/2)]

= 10.79%

Therefore, The yield to maturity on the Tangshan Industries bond is 10.79%

6 0

3 years ago

Sherry knew that her established customers liked her product much better than her competitor's. She was planning to expand into

Rom4ik [11]

Answer:

d. premium pricing.

Explanation:

Premium pricing is the strategy of pricing in which the product is highly priced in comparison to that of the other similar products available in the market. This is done in order to keep the belief in customers that the product is superior than those available in the market.

Some people those who think that expensive products are always nice, prefer these kind of products.

Here in the given instance also Sherry prefers this model and her ideology also matches with this technique.

7 0

3 years ago

3. Name two different market structures. Describe how and why they each have a different competitive situation.

xz_007 [3.2K]

Market structure is defined with characteristics of the market and there are four different market structures: perfect competition, oligopoly, monopoly and contestable market.
<span>Perfect competition is a market structure in which there is a large number of small firms who produce identical goods otherwise known as homogenous goods and it has a lot of buyers. The competition between these firms is huge, because they are many firms and each of them wants to attract more buyers.</span>
Oligopoly is a market structure in which there is a small amount of large firms, for example the supermarket industry. There are not so many buyers as in the perfect competition, but buyers can still choose from which supermarket, for example, they will buy. So there is a competition between the firms.

7 0

3 years ago