Allie has received a large sum of inheritance money and must decide the best way to invest it. Her

investment horizon is 15 years. One option is an Energy sector exchange-traded fund (ETF). ETF’s are

managed funds that trade a changing basket of stocks, bonds and futures. They charge a management fee

for this service.

Allie’s friend suggests an Energy Fund with a management fee of 2% that has an expected 6-10% annual

return. Her friend also advises her that property in her immediate area should double in value over the

next 15 years.

Assuming all gains are reinvested in the Energy Fund (compound interest) and she starts with a principal

of $80,000.Determine the: Maximum, minimum and mean returns of Energy Fund after 15 years

asked by guest
on Nov 24, 2024 at 10:26 am



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