When you own shares in a mutual fund you make money in which of the following ways?
A)As the value of all of the securities held by the mutual fund increase,the value of each mutual fund share also increases.
B)If a fund receives interest or dividends from its holdings this income is passed on to share holders.
C)If the fund sells a security for more than it originally paid for it,the shareholders receive this in the form of capital gains.
D)You receive a portion of the commissions that the fund manager charges for trades.
E)Only A,B and C are correct.

Question

Quizplus · Accepted Answer

Mutual fund shareholders can make money through three main avenues: appreciation in the value of their shares as the underlying securities increase in value, dividends or interest income distributed by the fund, and capital gains distributions when the fund sells securities for a profit. Shareholders do not receive a portion of the commissions charged by the fund manager for trades; these costs are expenses of the fund that reduce its overall return.

When You Own Shares in a Mutual Fund You Make