Which of the following is not true regarding mutual funds?
A) There are thousands of funds with many different investing objectives.
B) They offer small investors diversification and professional management.
C) Dividends received from their investments are used to pay operational expenses, and capital gains are passed on to the mutual fund shareowners.
D) Both dividends and gains are distributed to mutual fund shareowners.

Question

Quizplus · Accepted Answer

Mutual funds distribute dividends and capital gains to the shareholders, not use dividends to pay operational expenses. Operational expenses are covered by the fund's expense ratio.

Which of the Following Is Not True Regarding Mutual Funds