One incorrect belief that is often cited as a reason for fully-funded pension funds to invest in equities is
A)stocks have higher risk.
B)bonds have lower returns.
C)stocks provide a hedge against inflation.
D)stocks have higher returns.

Question

Quizplus · Accepted Answer

Stocks are often believed to provide a hedge against inflation, which is a misconception when used as a reason for fully-funded pension funds to invest in equities. This belief overlooks the risks and volatility associated with equities.

One Incorrect Belief That Is Often Cited as a Reason