Funds Intermediate: Growth Mutual Funds

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1.
How do the managers of growth mutual funds enable their funds to grow in value?
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They invest in the stocks of companies they believe will outperform the market average. They believe there is a demand for these stocks, which will increase in price.
2.
What is the objective of growth mutual funds?
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To grow over time. The objective of growth funds is to grow in value over time. Providing income is not a priority.
3.
Which of the following terms is not likely to be found in the name of a growth mutual fund?
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"Income." Growth funds do not pay enough income to warrant the use of a word like "income" in their names.
4.
Growth mutual funds rarely make the list of top ten funds from one year to the next because _______.
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They are very volatile. They may not perform as well as "top ten" funds every year, but over the course of many years, they show steady growth.
5.
The performance of a growth mutual fund depends upon the _______ of the securities it contains.
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Performance. A fund is only as good as the investments it contains.