What is the primary reason people invest in mutual funds? Option: To avoid market risks entirely, To get rich quickly, To directly control individual stock selections, To participate in a diversified investment pool with a common goal

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What is the primary reason people invest in mutual funds?

To avoid market risks entirely

To get rich quickly

To directly control individual stock selections

To participate in a diversified investment pool with a common goal

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What is the primary function of Mutual Funds?

To insure against market risks

To facilitate currency exchange

To pool funds from investors and invest in various assets

To provide short-term loans to businesses

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What is one of the primary reasons for the increasing popularity of mutual funds?

"Diversification and risk distribution"

"High short-term returns"

"Low investment threshold"

"Guaranteed profits"

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What is the primary investment objective of a Mutual Fund?

"To generate superior returns by pooling investments from multiple individuals and investing in a diversified portfolio of financial instruments."

"To primarily invest in government securities to ensure capital preservation and low risk."

"To offer tax benefits to investors while providing a moderate rate of interest."

"To provide a fixed rate of return, similar to a savings account, with a guaranteed return on investment."

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What is the primary function of a mutual fund?

To provide loans to small businesses

To offer high-interest savings accounts

To pool money from investors and invest it in various financial instruments

To facilitate direct stock trading for individual investors

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What is the primary reason investors diversify their investments across multiple mutual funds?

"To avoid paying taxes on investment gains"

"To mitigate risk and enhance potential returns"

"To solely support socially responsible companies"

"To guarantee a fixed return on investment"