Multiple choice

A fund with a high beta coefficient gives greater returns in a rising market, and is more risky in a falling market.

  1. True

  2. False

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Beta measures a fund's sensitivity to market movements. A beta >1 means the fund amplifies market moves, gaining more in bull markets but losing more in bear markets. This makes high-beta funds riskier during downturns.