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Funds 101: Mutual Fund Basics

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1.
Which of the following pieces of information on portfolio managers is included in a mutual fund prospectus?
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Employment history. This provides a sense of the managers' experience.
2.
It is possible to buy shares of a mutual fund directly from the fund instead of through a broker.
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True. Although you can buy shares through a broker, most funds also let you buy shares directly from the funds themselves.
3.
A mutual fund is a(n) _______.
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Package of several types of securities. Although some mutual funds invest only in stocks or bonds, mutual funds as a whole are open to several types of securities.
4.
In the world of mutual funds, what are outstanding shares?
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Shares owned by the public. To be "outstanding" is to be in the public's possession.
5.
Diversification spreads risk among several different investments.
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True. Each investment has its own risk profile.