Ch.12 · Model Portfolios and Asset Allocation · easy
Which of the following mutual fund categories is MOST appropriate for an investor saving for a goal that is 15 years away?
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EXPLANATION
For a 15-year horizon, equity funds are most appropriate. The long runway allows equity volatility to smooth out and historically delivers inflation-beating returns. Liquid, overnight, and ultra short duration funds are designed for very short-term parking of funds, not long-term wealth creation.
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