Asked by
Alvita Ukrainskiy
on Nov 04, 2024Verified
Target-date retirement funds are not
A) funds of funds diversified across stocks and bonds.
B) designed to change their asset allocation as time passes.
C) a simple, but useful, strategy.
D) designed to function much like hedge funds.
Target-date Funds
Mutual funds that automatically adjust their asset mix towards more conservative investments as the target date (usually retirement) approaches.
Asset Allocation
The process of dividing an investment portfolio among different asset categories, such as stocks, bonds, and cash, to optimize risk and reward based on an individual's goals and risk tolerance.
Hedge Funds
Investment funds that deploy a variety of strategies to earn returns on their capital, often engaging in more complex and higher-risk trades than traditional mutual funds.
- Understand the characteristics and purpose of target-date retirement funds.
Verified Answer
SS
Learning Objectives
- Understand the characteristics and purpose of target-date retirement funds.