If an investor wishes to invest 100% of her portfolio in safe assets but does not wish to manage her portfolio, she should invest in ________.

Question

Quizplus · Accepted Answer

A money market fund invests in short-term, low-risk instruments such as Treasury bills and commercial paper. It provides a relatively safe investment option for investors who do not wish to actively manage their portfolio but want their investments to be in safe assets. Investing in several different money market instruments, as suggested in choice C, can be time-consuming and may require a higher level of expertise, which may not be suitable for investors who are not interested in managing their portfolio. Growth share funds, as suggested in choice B, seek capital appreciation through investments in growth-oriented stocks and are riskier in nature, making them less suitable for investors seeking safe assets. Similarly, investing in several different shares, as suggested in choice D, can expose an investor to higher risks and require active management, making it unsuitable for investors who do not wish to manage their portfolio.

If an Investor Wishes to Invest 100% of Her Portfolio