Which of the following statements is NOT correct?
A)ETFs are like index mutual funds in that the share price adjusts over time in response to changes in the index level.
B)ETFs normally do not have capital gains and losses that must be distributed to shareholders.
C)The portfolio management of both ETFs and index mutual funds is very complex.
D)ETFs can be traded throughout the day.

Question

Quizplus · Accepted Answer

ETFs and index mutual funds are designed to track the performance of a specific index, and their portfolio management is generally not considered very complex compared to actively managed funds. The complexity lies in their structure and the mechanism of tracking the index rather than in active portfolio management decisions.

Which of the Following Statements Is NOT Correct