Which of the following funds are usually most tax-efficient?

Question

Quizplus · Accepted Answer

ETFs (Exchange-traded funds) are usually the most tax-efficient as they have a low turnover rate which results in minimal capital gains distributions. Bond funds may also be tax-efficient, but it depends on the bond's maturity, credit quality, and other factors. Equity funds and specialized-sector funds tend to have higher turnover rates, resulting in higher capital gains distributions, making them less tax-efficient.

Which of the Following Funds Are Usually Most Tax-Efficient