Your Client, Mr

Your client, Mr. Whiff, knows nothing about investment companies, and you are educating him about the advantages of investing through one, rather than investing in individual stocks and bonds. Which of the following statements could get you in trouble?

A) "In investing through an investment company you will be able to invest a small amount of money and achieve greater diversification than you could otherwise."
B) "Investing through an investment company will result in a lower tax bill than had you invested in individual stocks and bonds."
C) "An investment in an investment company gives you an undivided interest in the company, in proportion to the number of shares you own."
D) "By investing your money through an investment company, you are getting the benefit of professional management."

Correct Answer:

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