This approach is called <u>passive investment</u>
Passive investment refers to an investment strategy used by investors to increase their returns by selling and buying. Investors uses this investment strategy to prevent some fees and cut out limited performance that may likely accompany regular trading.
<h2>Further Explanation</h2>
Most investors used this strategy to have more returns which also help them to build wealth gradually. Passive investing is also called a buy and hold strategy. In passive investing, an investor buys security and hold to it for a longer-term.
Passive investors don’t look forward to profiting from short market fluctuation rather investors that used this strategy only have interest in the returns the markets bring in the long run.
Passive investors understand the market nitty-gritty, they also believe it is almost impossible to out-think the market, hence the reason they always to try to march market performance.
There are several benefits investors derived from using this investment strategy.
Some of these benefits include:
<u>Transparency:</u> investors do know the assets in an index fund
<u>Extreme low fees:</u> monitoring is not necessary simply because no one is picking stocks
<u>Tax efficiency:</u> this strategy does not lead to a yearly tax of massive capital gains since passive investors only buy and hold.
<u>Simplicity:</u> to own an index is very easy to implement and understand when compared to a dynamic strategy that involves regular adjustment and research.
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KEYWORDS:
- mutual fund
- passive investing
- vanguard index 500
- market
- index
Answer:
superior competence
Explanation:
Superior competence is a skill an agent is expected to display in a resonable manner in any situation.
An agent is a person appointed by the principal and one who links the principal to the third party while principal is someone who appoints an agent to act on its behalf.
An agent is not superior to the principal. In other words, an agent is expected to act reseanably at all times in accordance with the terms of his contract with the principal.
Some of the duties of an agent to his principal are
- reasonable care and skill
-duty not to delegate
-avoid conflict of interest
-act within the scope of powers and authority delegated to him
Answer:
Descriptive Statistics
Explanation:
Descriptive Statistics is a technique in which data is collected and then analysis is made on the selected data through numerical techniques or graphs. In the given question the students have selected stocks and are analyzing its performance through graphical and numerical technique. This is descriptive statistics.
Answer:
E) I, II, and III.
Explanation:
Variable costing can be regarded as a concept of managerial accounting cost
whereby during the period of producing the product there is incurred
manufacturing overhead.
Absorption costing income statement, utilize absorption costing when creating income statement. The income statement focus on the cost through sectioning of cost into period cost and product.
It should be noted that
I. A variable-costing income statement discloses a firm's contribution margin.
II. Cost of goods sold on an absorption-costing income statement includes fixed costs.
III. The amount of variable selling and administrative cost is the same on absorption- and variable-costing income statements.
Economic profits that are present in the short run.
