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Funds 207: Examining a Stock Fund's Portfolio: The Morningstar Style Box

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1.
A blended fund, as shown by the Morningstar style box, will include elements of both growth and value orientations.
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True. A blended fund uses both.
2.
The Morningstar style box does not summarize which of the following?
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How rapidly a fund manager buys and sells stocks. The style box provides a snapshot of the size and price of the stocks in a fund's portfolio. To get a feel for how rapidly a fund manager buys and sells stocks, check a fund's turnover rate.
3.
Which type of fund is likely to be the most volatile?
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A small-cap growth fund. Funds that own expensive (growth) small companies are bound to be more volatile than those that own large, inexpensive (value) stocks or middle-of-the-road (blend) fare are.
4.
The stock of which type of company is likely to be the least volatile?
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A large size company. Larger companies are often more established and tend to be more predictable than smaller companies; therefore, their stock prices tend to be steadier.
5.
According to the Morningstar style box, a value orientation means the manager buys stocks that are cheap.
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True. Though the stocks are cheap, they could eventually see their worth recognized by the market.