Multiple choice

Which of the following is not true about a mutual fund?

  1. The mutual fund is owned by all the investors

  2. Mutual fund gives a diversified portfolio to investors

  3. The objectives of investors of a mutual fund are diverse

  4. The mutual funds do not invest in real estate
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

This question asks which statement is NOT true. Options A, B, and D are all true statements about mutual funds - they ARE owned by all investors, they DO provide diversified portfolios, and they DON'T invest in real estate (they invest in securities). Option C claims investor objectives are diverse, which is FALSE - mutual funds are designed for investors with SIMILAR objectives (growth, income, etc.) as stated in the scheme's mandate. Therefore, C correctly identifies the statement that is 'not true'.

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