Question

Which one of the following statements is correct concerning the mutual fund cash ratio​ (MFCR)? Group...

Which one of the following statements is correct concerning the mutual fund cash ratio​ (MFCR)?
Group of answer choices
The lower the value of the​ MFCR, the stronger the market will be in the future.
A MFCR greater than​ 15% is considered a bearish signal.
A low MFCR indicates that fund managers might be forced to sell securities should investors wish to withdraw funds.
The MFCR is equal to the cash inflows into money market funds divided by the cash flows out of money market funds.
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Answer #1

Answer to the Question is "A low MFCR indicates that fund managers might be forced to sell securities should investors wish to withdraw funds."

MFCR stands for Mutual Fund Cash Ratio, it is a way to measure that compares the amount of cash in a fund relative to its total assets. MFCR is equal to Mutual Fund Cash Position / Total Asset under management. Based on the MFCR analysis, a low MFCR indicates that the Cash is very low as compared to the asset invested that will cause a rise to sell of securities if investor wishes to withdraw funds.

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