Indexing is an investment strategy that tracks a benchmark index and issimple for investors to understand. This ease of understanding is one of its primary advantages.
Option A: Indexing does not provide preferential tax treatment for derivative-based income.
Option C: While low-cost, indexing does not offer an opportunity to outperform the market—it aims to match the market's performance.
Option D: Indexing is typically suited for long-term investing due to its emphasis on broad market exposure and passive management.
References: Canadian Securities Course Volume 2, Portfolio Management Section.
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