An investor seeking the highest possible return and who is willing to live with a great deal of risk would be best served by which of the following types of mutual funds?

Question

Quizplus · Accepted Answer

High Yield Bond Funds are known for offering the highest returns among mutual funds, but they also carry a higher level of risk due to investing in lower-rated, higher-yield bonds. Therefore, they are best suited for investors seeking high returns but are willing to take on significant risk. Balanced funds mix stocks and bonds to offer a moderate return with lower risk, U.S. Government Income Funds invest in government bonds offering a consistent but lower return, and Ginnie Mae Funds invest only in mortgage-backed securities guaranteed by the government which offer a modest return and low risk.

An Investor Seeking the Highest Possible Return and Who Is