Question

11 unlike investments in stocks and bonds, mutual funds involve no risks.
true
false

Explanation:

Analyze the statement

The statement claims that mutual funds involve no risks, unlike investments in stocks and bonds.

Evaluate investment risks

Mutual funds are pools of money collected from many investors to invest in securities like stocks, bonds, and other assets. Because they consist of these underlying assets, they carry the market risks associated with those assets. While diversification reduces specific company risk, it does not eliminate market risk entirely. Therefore, mutual funds do carry risk, making the statement false.

Answer:

• True
• False (Correct answer)