Which of the following statements is incorrect?
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

Not all expenses charged and reflected in the expense ratio of a mutual fund are always valid. There may be certain expenses that are excessive or unnecessary, leading to a higher expense ratio and lower returns for investors. It is important to carefully review the expense ratio of a mutual fund before investing.

Which of the Following Statements Is Incorrect