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1.
A fund's turnover rate is usually calculated _______.
Once a year. As a rule, turnover rates are calculated yearly.
2.
Sector weightings in a fund tell you what?
What industries your manager favors. If a fund has 50% of its portfolio in the technology sector, for example, half of its performance will be determined by the strength or weakness of that one sector.
3.
A fund's number of holdings tells you how much sector risk a fund is taking on.
False. The number of holdings tells you how much per-issue risk a fund is taking on.
4.
The large differences in size among funds in the "small-cap" section of the Morningstar style box mean that _______.
Some will outperform others at times. Some funds will perform better than others during market conditions that favor the companies they hold.
5.
Price/earnings multiples tell you what?
How much price risk a fund is taking on. The greater a fund's price/earnings multiple, the greater its price risk.
