Choose wisely. There is only one correct answer to each question.
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1.
Which type of fund is least likely to be affected by a change in management?
An index fund. Index funds mimic indexes; no matter who is managing, the selection of stocks will be according to that benchmark.
2.
If a mutual fund starts out as a small-cap fund, it may eventually become a mid-cap or large-cap fund.
True. Some funds change their focus years later.
3.
Why might asset growth be a bad thing for some mutual funds?
It can ultimately lower returns. Having a lot of assets can sometimes weigh down returns.
4.
As a mutual fund family grows, its funds will continue to perform their original roles.
False. Sometimes a fund changes its focus, for example from small-cap to mid-cap.
5.
Why is it important to monitor your fund families?
Both of the above. Changes at fund families can mean changes at your fund if your manager takes on new responsibilities or is otherwise distracted from running the fund that you own.
