An open-end investment company that can issue an unlimited number of its shares to investors and use the pooled proceeds to purchase corporate and government securities is called: A. a mutual fund B. a pension fund C. an insurance company D. a brokerage firm

Question

Dominic

Business

23 December, 04:52

An open-end investment company that can issue an unlimited number of its shares to investors and use the pooled proceeds to purchase corporate and government securities is called: A. a mutual fund B. a pension fund C. an insurance company D. a brokerage firm

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Answers (1)

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Dulce Flowers · Answer 1

A. a mutual fund

Explanation:

A mutual fund -

It is a type of financial vehicle, where the money collected by the investors, is pooled and then further invested in securities, like the bonds or stock market is referred to as mutual fund.

Any investor can invest their money in the mutual funds, it is a indirect form of investing in the stock market.

The returns obtained by mutual funds are dependent on the stock market.

Hence, from the given information of the question,

The correct option is A. a mutual fund.