Which of the following is the most common competitor for mortgage funds?

The most common competitor for mortgage funds is long-term government bonds. This is primarily due to the nature of investor behavior and the characteristics of these financial instruments. Long-term government bonds generally offer a steady income stream through interest payments over a longer duration, similar to how mortgage funds provide returns.

Investors often compare these bonds to mortgage-backed securities or mortgage funds because both typically involve a fixed-income component and share volatility characteristics. If long-term government bonds yield higher interest rates, investors may prefer these over mortgage funds, leading to competition for capital. Consequently, the demand and supply dynamics within these markets can significantly impact the availability and pricing of mortgage funds.

In contrast, savings account deposits and short-term money market funds typically cater to liquidity and low-risk preferences, serving a different market segment. Long-term certificates of deposit, while fixed-income products, often feature less liquidity compared to government bonds, further differentiating them as competitors.