The Mutual Funds
KPL Asset Allocation Fund
A fund aims for consistent total returns. The management is empowered to shift assets among stocks, bonds, and short-term fixed-income securities in accordance with its projections of future market conditions. Because of its ability to diversify among many investment instruments, the fund has the potential to provide maximum returns while reducing volatility. This information describes which of the following mutual funds?
Spencer Cash Reserve Fund
The fund's objectives are to maintain a stable net asset value and to provide current income. The fund invests in high-quality short-term obligations, including U.S. treasury bills, commercial paper certificates of deposit, and repurchase agreements. Check-writing privilege are available.
MacDonald Investment-Grade Bond Fund
The fund seeks high current yield accompanied by reasonable risk. It invests most of its portfolio in corporate bonds having one of the top three ratings according to Moody's and Standard & poor's. It seeks to reduce the risk associated with interest rate fluctuations by investing a portion of its assets in short-term corporate debt.
ATF Overseas Opportunities Fund
The fund seeks maximum capital appreciation by investing in common stocks of companies located outside the United States. The management selects well-established companies that are listed on their native stock exchanges and that have demonstrated high earnings potential. Although the fund may be affected by fluctuations in currency exchange rates, over the long term it may provide protection against downturns in U.S. markets.
Laramie Equity Income Fund
The fund seeks primarily current income, with secondary objectives of capital growth and growth of income. Its portfolio consists of common stock, preferred stock, and convertible securities of large, well-established companies with a history of paying high dividends. Its equity concentration can help protect against the loss of purchasing power owing to inflation.
ATF Capital Appreciation Fund
The fund seeks to achieve maximum capital appreciation with little or no pursuit of current income. The fund invests in stocks of small and medium-size companies that demonstrate significant long-term growth potential. The fund's management believes that despite year-to-year fluctuations, the strategy of investing in companies that show strong earnings growth can result in superior investment returns.
MacDonald Stock Index Fund
The fund seeks to duplicate the price and yield performance of Standard & Poor's Composite Index of 500 stocks. The fund invests in each of the index's 500 stocks in approximately the same composition as the index. The portfolio is not actively traded and therefore features a low turnover ratio.
XYZ Government Income Fund
The fund seeks to maximize safety of invested principal while providing current income. By investing in a broad range of debt securities issued by the U.S. treasury as well as government agencies such as the Government National Mortgage Association, the fund provides reduced risk. It aims for a current yield higher than the yield of short-term debt instruments and money market instruments.
Spencer Tax-Free Municipal Bond Fund
The fund seeks to maximize tax-exempt current yield. It invests in a portfolio of high-quality municipal debt obligations. The portfolio is diversified among securities issued by many different state and municipal taxing authorities. Income distributions provided by the fund are exempt from federal income tax.
MacDonald Balanced Fund
The fund seeks to preserve capital, to generate current income, and to provide long-term capital growth. Its strategy is to invest 60% of its portfolio in common stocks and 40% in bonds and fixed income securities. Through diversification, the fund intends to provide protection against downturns in the market. In its endeavors to produce positive returns during market decline, the fund may not participate fully in rising stock markets.
ATF Biotechnology fund
This fund seeks maximum capital appreciation through investment in stocks of companies providing innovative products in the biotechnology sector, including pharmaceutical developers and medical equipment suppliers. Fund management seeks to evaluate emerging economic and political trends and to select individual companies that may benefit from technological advances.
Preferred stock fund
generates current income in the form of dividends. Aggressive growth funds strive for capital appreciation rather than current income. Money market funds have low yields, not the high yields that an income investor wants. While high-yield bonds provide current income, they entail a high, rather than a moderate, degree of risk.
