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A) index funds/ money market mutual funds/ sector funds
B)esctor funds/index funds/money market mutual funds
C) money market mutual funds/index funds/sector funds
6. Mutual funds by risk and return Risk and Return of Money Market Mutual Funds, Sector Funds, and Index Funds The following
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Answer #1

Money market funds are instruments with funds primarily invested in short term bonds and government securities. As such its risk and expected return would be the lowest.

Index funds are broad market funds generally accepted and considered as proxy for entire market. As such such equity funds would be diversified and have less risks and corresponding expected returns. Index funds are benchmarked as market portfolio for performance assessment. Index funds are mostly passively managed for it mimics the broader indices.

Sector funds are much more volatile and riskier than index funds for it is less diversified and more concentrated. This provides more expected returns than index funds.

So A is sector funds,

B is Index funds

C is Money market funds

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