SIE practice questioneasyVariable Annuities
Investors in variable annuities bear which of the following risks?
- AInvestment performance risk✓ Correct answer
- BGuaranteed principal protection
- CNo market risk
- DNo risk of loss
Explanation
Why A — Investment performance risk
Variable annuity values fluctuate based on the performance of underlying investments; principal is not guaranteed, and investors assume market risk. Choices B, C, and D are incorrect.
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