alleryStart learning →What protection applies to money invested in securities and mutual funds?
AFull FDIC insurance up to a limit
BTypically no federal insurance at all
CA government guarantee of the principal
DAutomatic refunds from the exchange
Answer & Solution
Correct answer: B. Typically no federal insurance at all
1. Saving and investing carry different protections.
2. Money invested in securities and mutual funds typically is not federally insured.
3. You could lose your principal, the amount invested, in exchange for the chance to earn more.
_Source: "Saving and Investing: A Roadmap to Your Financial Security" (US SEC, public domain), section Investing_
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