What is the primary limitation of using point-to-point return as a measure of investment performance?

It only considers the return for the specific start and end dates. It doesn't account for dividends. It's too complex for average investors to understand. It's only applicable to mutual funds.

What does rolling return provide that point-to-point return does not?

A fixed annual return. A guaranteed minimum return. A historical perspective of how returns have changed over time. The exact return an investor will receive.

Why is understanding rolling returns important for mutual fund investors?

It guarantees a positive return. It helps predict future market crashes. It provides a more realistic view of potential investment outcomes. It simplifies complex financial calculations.

How can an investor use rolling return data to make more informed investment decisions?

By focusing solely on the highest rolling return. By ignoring point-to-point return data. By analyzing the historical range and average of rolling returns for a specific period. By investing only in funds with consistently positive rolling returns.

What is the recommended minimum time frame for considering rolling returns when evaluating equity mutual funds?

1 year 2 years 5 years 10 years