One of your clients wishes to invest in a fund of hedge funds. You could tell him which of the following?
A) Shares of these funds are easy to redeem.
B) Expenses for these funds tend to be higher than those for other funds.
C) He can expect to make a profit whether the markets trend up or trend down.
D) These funds purchase a large amount of preferred stock.
Answer: B) Expenses for these funds tend to be higher than those for other funds.