Multiple choice

Portfolio turnover rate of a fund measures the

  1. size of the fund's portfolio

  2. amount of buying and selling done by the fund

  3. the average number of units sold by the fund in one day

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Portfolio turnover measures the extent of buying and selling activity in the fund's portfolio. It indicates how actively the fund manager trades securities, not the portfolio size or unit sales to investors. High turnover suggests active trading strategy, while low turnover indicates a buy-and-hold approach.

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