You are trying to decide whether to invest your savings in a mutual fund or to...
You are trying to decide whether to invest your savings in a mutual fund or to put it into a savings account. You respond to an advertisement from a financial advisor who tells you that, based on his research and expertise, his investment strategy is a sure bet, and it will certainly yield you the best return.
Homework Answers
In such a situation risk factors matters. Investing in a saving account is totally safe but the interest we get is very low. While in mutual fund return is very high in compared to the saving account. But before choosing to invest in a mutual fund the person needs to read all the documents carefully and especially the terms and conditions. In such a situation we should not listen or follow to others instead of that we should try to analyze the condition and its benefit by ourselves. If someone is saying that we can get more return by investing in the mutual fund then it becomes our duty to check the level of risk and if possible take a written note from the person who is asking us to invest in the mutual fund.
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