CHP 13 – D2L Quiz – Mutual Funds; ETFS – Flashcards
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Open-end investment company
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Another name for a mutual fund
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Distributor
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Sells fund shares, either directly to the public or through certain authorized dealers
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Money manager
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Runs the portfolio and makes the buy and sell decisions
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Closed-end investment companies are characterized by
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Availability for sale or purchase on security markets
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Closed-end investment company that invests in various types of real estate and mortgages is a
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Hybrid real estate investment trust.
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Hybrid real estate investment trust
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Closed-end investment company that invests in various types of real estate and mortgages is a
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Exchange traded fund
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Which of the following combines the operating characteristics of an open-end fund with some of the trading characteristics of a closed-end fund?
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Exchange-traded mutual funds
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Traded on listed exchanges
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REIT: What type of REIT is most attractive to income oriented investors?
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Mortgage
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No load mutual fund: The maximum sales charge a no load mutual fund can charge
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0: it's a no load mutual fund
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Back-end load.
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Redeeming your mutual fund shares might result in a charge called
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Back end loaded mutual funds are most appropriate for
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An investor with a short time horizon
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No-load fund has no
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Administrative charges.
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12(b)-1 fee
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Marketing and distribution expenses: An annual fee charged by some mutual funds to cover marketing and distribution expenses is the
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Management fee
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Load and no-load funds will always charge a
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Mutual funds may be bought and sold through
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Brokerage firms and fund salespeople
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Back-end load
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Wall Street Journal's listing of mutual funds, an "r" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.
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Back-end load & 12b-1 fee
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Wall Street Journal's listing of mutual funds, a "t" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.
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12b-1 fee & Back-end load
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Wall Street Journal's listing of mutual funds, a "t" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.
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12b-1 fee
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Wall Street Journal's listing of mutual funds, a "p" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.
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Annual Account Maintenance Fee
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Mutual fund fees are paid directly from the investor
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NAV of an open-ended mutual fund priced at $10 be if the load is 4%?
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$9.60
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No-load fund: To be a true no-load fund, there can be a maximum ____ load and a maximum ____ 12(b)-1 fee.
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Maximum 0% load ; a maximum 0.25% 12(b)-1 fee
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Investment company earnings come from
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Interest, dividends, and capital gains.
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Aggressive growth
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Fund: A(n) ____ fund is quite speculative.
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Sector
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Fund: A fund that invests only in a particular industry would be a ____ fund.
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Municipal bond fund
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Tax-free income: Which of the following bond mutual funds would provide tax-free income?
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Socially Responsible Funds typically avoid investing in
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Alcohol and Tobacco stocks
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Index funds have provided competitive rates of return because
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All of them are true: a. their costs are lower than other stock funds. b. it is difficult to outperform the market. c. they have very low turnover rates. d. they are tax efficient.
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Equity-income
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Fund: A(n) ____ fund invests primarily in a portfolio of common stocks for the income they provide.
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Balanced Fund
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Mutual fund with an objective of both growth and income is a(n)
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Growth and income fund.
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A balanced fund that emphasizes growth in capital is called a(n)
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Balanced fund that emphasizes growth in capital is called a(n)
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Growth and income fund.
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Mutual Funds: _____ _______ would not be a reason for purchasing mutual funds.
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Tax advantage
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Mutual Funds: Most mutual funds allow investors to participate in
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Automatic reinvestment plans, Automatic investment plans
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Automatic reinvestment plans, Automatic investment plans
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Mutual Funds: Most mutual funds allow investors to participate in
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Mutual funds: major advantage of mutual funds to the small investor is
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Diversification
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Mutual Funds source of returns include:
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Dividend income, capital gains, changes in NAV, (but not IDBs)
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Guaranteed performance.
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Mutual funds do not offer
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Mutual funds do not offer
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Guaranteed performance.
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Automatic reinvestment plan
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The ____ is a service offered by mutual funds that helps an investor earn compound interest on their investments.
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Systematic withdrawal plans
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If you are a mutual fund investor who needs steady income, you might take advantage of a fund's
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Fund family
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A group of funds managed by a single company which offers conversion privileges is called a
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Future course of the market.
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Future fund performance is the real key to investment success with mutual funds. One important element to examine when attempting to predict a fund's future performance is the
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Future fund performance is the real key to investment success with mutual funds. One important element to examine when attempting to predict a fund's future performance is the
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Future course of the market.
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Value funds look for stocks with relatively all the following
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High dividend yields, moderate amounts of leverage, undiscovered companies, low P/E ratios
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Exchange traded funds advantages over mutual funds include all of the following except: a. narrow geographic region d. industry focus b. single foreign countries e. sector focus c. better diversification
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Better diversification
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Asset allocation funds invest money in
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Stocks, bonds and real estate
