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Funds that normally contain a combination of common stock and fixed income securities are known as...

Funds that normally contain a combination of common stock and fixed income securities are known as a. Income funds. b. Section 401(k) plans. c. Flexible funds. d. Balanced funds. e. Contractual plans.

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Expert Solution

The right answer is Balanced funds

Funds that normally contain a combination of common stock and fixed income securities are known as Balanced funds. They also known as hybrid funds since they contain a combination of risk-free investment like government bonds and high return securities like common stocks.

Let's look at other options which are incorrect options

  1. Income funds: Basically in these type of funds, money is invested in securities which generate income in form of dividend or interest payments.
  2. Section 401(k) plans: They are basically employer-sponsored retirement plans
  3. Flexible funds: Portfolio manager has high flexibility in these type of funds. There are no fundamental criteria that a fund manager must follow. They are basically invested for large hedge or according to a larger vision of economic factors which are macro in nature. Most of the time investment made in these type of investment keeping in mind the high return in high-risk profile securities fundamentals.   

jeff jeffy answered 2 years ago
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