Which of the following bond mutual funds has both the lowest default risk and interest rate risk?

Question

Quizplus · Accepted Answer

Short-term Treasury bond mutual funds have the lowest default risk because they invest in government bonds issued by the US Treasury, which are considered the safest investments available. Additionally, they have lower interest rate risk compared to long-term bond funds because their maturity is shorter, which means they are less sensitive to changes in interest rates. Therefore, A) Short-term Treasury is the best choice for the lowest default and interest rate risk in bond mutual funds.

Which of the Following Bond Mutual Funds Has Both the Lowest