Which of the following statements is NOT correct?
A)A mutual fund is usually run by an investment company.
B)Mutual funds with lower expense ratios tend to outperform other funds with a similar investment objective.
C)For each mutual fund, all expenses charged and reflected in the expense ratio are always valid.
D)The SEC requires that a majority of the directors of a mutual fund board be independent.

Question

Quizplus · Accepted Answer

The statement that all expenses charged and reflected in the expense ratio of a mutual fund are always valid is not necessarily correct. While the expense ratio includes various fees such as management fees, administrative fees, and other operational costs, the validity and reasonableness of these charges can vary and are subject to scrutiny by investors and regulators.

Which of the Following Statements Is NOT Correct