SIE Exam Practice Question 489
Question: 489
An investor has a conservative attitude toward investing and is seeking to invest $100,000 into an instrument that will provide current income and the most protection from interest rate risk. You would most likely recommend which of the following?
Correct Answer: A
Explanation:
A: An investor seeking protection from interest rate risk will most likely be best suited for a portfolio of Treasury bills. As the bills mature, the investor can roll over the position into newly issued bills with new interest rates.
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