An indexed equity mutual fund
A) is directly tied to either the consumer price index or the GDP deflator.
B) is a fund that hires a manager who will try to pick the stocks that will increase most in value in the future.
C) merely holds stocks in the same proportion as they exist in a broad stock market index like the Standard & Poor's 500.
D) will have high operating costs because these funds engage in a substantial amount of stock trading.

Question

Quizplus · Accepted Answer

An indexed equity mutual fund aims to replicate the performance of a specific stock market index by holding stocks in the same proportion as the index, resulting in lower operating costs due to minimal trading.

An Indexed Equity Mutual Fund