6. Let\'s say you are actively managing your own 401K Plan. You have several U.S

Question

6. Let's say you are actively managing your own 401K Plan. You have several U.S. stock funds, a U.S corporate bond fund, a money market fund, and a couple international stock funds to choose from when allocating your funds. At what point might you switch your fund allocations from stock funds to bond funds? A. When the S&P; 500 is as low as you expect it to go for awhile & the "Fed" is worried about inflation. B. When the S&P; 500 is as high as you expect it to go for awhile &Fiscal; Policy suggests deficit spending When the S&P; 500 is as high as you expect it to go for awhile & market interest rates have probably peaked for awhile due to the "Fed" believing that inflation is "under control" C. D. When the U.S. Government stops its "deficit spending" & "war-mongering behavior"

Explanation / Answer

the answer will be option C , as the expectation from the stocks have been met and they met fall while the intrest rate as they have reached in peak shall fall and the prices shall increaase for bond due to fall in intrest rate and thus making it a oppurtunity for in the bond market to get good returns

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