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1.
A funds asset growth can lead to many problems. Which of the following is not typically one of them?
Higher expenses. As assets grow, expenses may decline. But performance may stall, and the funds manager may have to change his or her strategy to accommodate all that money.
2.
Which government source provides you with information on funds?
Securities and Exchange Commission. The Securities and Exchange Commission provides the EDGAR database of information on funds.
3.
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.
4.
As funds grow, how do managers often change their strategies?
They buy more stocks. To accommodate asset growth, some fund managers will buy more stocks, buy larger companies, or trade less.
5.
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.
