What are Dividend Yield Mutual Funds primarily focused on?

Investing in companies with a history of high dividend payouts Investing in high-growth technology startups Investing in bonds with varying maturity dates Investing in real estate properties for rental income

What is a key characteristic of companies that Dividend Yield Mutual Funds typically invest in?

They are often large, well-established companies with a history of stable earnings They are primarily early-stage startups with high growth potential They are companies focused on developing renewable energy sources They are companies involved in cryptocurrency mining and trading

What is the primary factor that influences a company's decision to declare dividends?

The company's profitability and financial performance The current interest rates set by the central bank The number of employees working for the company The company's social media presence and brand popularity

Why might a Dividend Yield Mutual Fund choose not to invest in a company that pays good dividends?

If the company's stock price is very high, resulting in a low dividend yield If the company is involved in environmentally unsustainable practices If the company has a history of labor disputes and strikes If the company's products are not popular among young consumers

What is a potential advantage of investing in Dividend Yield Mutual Funds for investors with a low-risk tolerance?

They offer a relatively stable income stream compared to high-growth stocks They provide guaranteed returns, regardless of market fluctuations They are exempt from taxation, making them a tax-efficient investment They offer the potential for rapid capital appreciation in a short period

What is a common investment strategy for Dividend Yield Mutual Funds?

Investing in companies with a dividend yield higher than the market average Investing in companies with a history of share buybacks Investing in companies with a high price-to-earnings ratio Investing in companies with a large amount of debt

What is a key consideration for fund managers when selecting stocks for a Dividend Yield Mutual Fund?

Both the dividend yield and the company's overall financial health and growth prospects Solely the dividend yield, regardless of other financial factors The company's environmental, social, and governance (ESG) rating The company's popularity among retail investors and day traders

What is a potential drawback of investing in a Dividend Yield Mutual Fund?

The NAV (Net Asset Value) might not grow as rapidly as funds focused on growth stocks They are only available to accredited investors with a high net worth They are highly complex investments that require specialized financial knowledge They are subject to frequent trading halts and regulatory scrutiny

What is a common reason why investors choose to invest in Dividend Yield Mutual Funds?

To generate a regular stream of income from dividend payouts To speculate on short-term price movements in the stock market To gain exposure to emerging markets and developing economies To invest in companies developing artificial intelligence technologies

What is the minimum investment amount typically required for a Systematic Investment Plan (SIP) in a Dividend Yield Mutual Fund?

Rs. 500 Rs. 50,000 Rs. 1 crore There is no minimum investment requirement