Which investment fund typically uses a variety of strategies to earn active returns?

The correct answer is hedge fund, as these investment funds are designed to employ a range of strategies and techniques to achieve active returns and maximize investment performance. Hedge funds often invest in a diverse array of asset classes, including equities, fixed income, derivatives, and foreign currencies. They may employ strategies such as long/short equity, arbitrage, market neutral, and global macro, among others, which allow them to capitalize on market inefficiencies and potentially generate higher returns than traditional investment vehicles.

This dynamic approach to investing is a hallmark of hedge funds, distinguishing them from more conventional investment funds like mutual funds or exchange-traded funds, which typically follow more passive management strategies and adhere to specific investment objectives as outlined in their prospectuses. Additionally, pension funds are generally focused on long-term capital preservation and meeting future liabilities for retirees, rather than actively seeking high returns through aggressive investment tactics.