Aggressive growth funds typically buy stocks with high PE ratios and stocks with volatile price fluctuations.

Question

Quizplus · Accepted Answer

Aggressive growth funds seek higher returns by investing in companies with high growth potential, which typically have high earnings growth rates, leading to high price/earnings (PE) ratios. These funds may also invest in more volatile stocks to further increase their potential gains. Therefore, the statement is true.

Aggressive Growth Funds Typically Buy Stocks with High PE Ratios