- 20 Marks
MCBFI – APR 2023 – L4 – Q5 – Investor Attitude to Risk, Risk Reduction, and Mutual Funds vs Shares
Assess investors' attitude to risk, strategies to reduce risk, and distinguish between mutual funds and shares amid high T-bill rates and bond turmoil in Ghana.
Question
The current macro-economic policies have really undermined the principles covering Government Securities and its associated risks. The relatively high Treasury Bills rates have attracted massive interests by prospective investors whilst the Bond Market is in turmoil. The Bank of Ghana is receiving massive over subscription week on week by investors in Treasury Bills, in most recent Weekly Auctions.
Required:
(a) Assess the attitude to risk by investors. (6 marks)
(b) What can the investors do to avoid or reduce risk? (6 marks)
(c) Clearly distinguish between Mutual Funds and Shares. (8 marks) (Total: 20 marks)
Find Related Questions by Tags, levels, etc.
- Tags: Bond Market, Government Securities, Mutual Funds, Risk Attitude, Risk Reduction, Shares, Treasury bills
- Level: Level 4
- Topic: Standard Deviation
- Series: APR 2023
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