The Investment Company Act of 1940 requires that the minimum capital to start a fund is $100,000. continuously issues and redeems its own shares. Hedge funds offer higher returns coupled with higher risk and are only sold to accredited (wealthy, sophisticated) investors who understand the risks involved. may correspond to ownership of a fraction of a foreign share A. $0 - $10,000 8 % (b) What is the probability that no cancellations will occur on a particular Wednesday? If the market rises, the customers loss can be infinite. A. setting maximum sales charges on mutual fund purchasesB. A. B They have come to you to obtain information about the basic elements of a partnership agreement. III Annuity payments may be reduced because of increased expenses experienced by the insurance company B Class D shares are typically sold by investment advisers. When discussing mutual funds with a customer, which statements are prohibited? This action is: A. appropriate for the customerB. Monday, June 19thD. I and III onlyC. Management and other fees are extremely low compared to other types of funds. I, II and IIID. IV Hedge fund managers can only be compensated based on a percentage of assets under management [3] The manager of an unregistered hedge fund charges a fee of 2 and 20. This means that investors are charged a(n): A. annual management fee against net assets of 2% plus a performance fee based on exceeding a benchmark index by 20%B. Buying a security into inventory directly from a customer with a mark-down. Correct Answer A. When making a presentation to a client that wishes to purchase a mutual fund, the representative compares the 5-year return of the fund to the 10-year return of the Standard and Poors 500 Index to illustrate the funds performance. I Investors have a Federal tax liability on the interest income received from the fundII Investors have no Federal tax liability on the interest income received from the fundIII The investment company has Federal tax liability on the undistributed income that it retainsIV The investment company has no Federal tax liability on the undistributed income that it retains. II and IVC. At the end of 13 months, the NAV is $20,000. higher average return on investment. It is typically 1/2 - 1% of assets annually. Hedge funds started in the 1990s and the managers produced superior returns and were able to charge high fees. Which statements are TRUE when the Federal Reserve enters into a repurchase agreement with a U.S. Government securities dealer? B. I and IV Which of the following investment company terms are synonymous? The representative has acted properly - no additional disclosures are required to be made to the customerB. B. ETNs have market riskD. A) ETF indexes allow the investor to easily become fully diversified. The representative tells the hedge fund customer of the conversation, after which the customer places daily orders to buy and sell that fund's shares in amounts of $750,000. All of the above. II and IIID. Their dividends are tax-deductible expenses to the issuing firms. A customer has $24,000 to invest in mutual fund shares. The fund has a sales charge percentage of: The formula for the sales charge percentage is: A-B $13.30 - $12.30 $1.00- = - = = 7.5% A $13.30 $13.30. D IV Whether the customer can handle declining benefit payments in retirement This is a new issue prospectus offering, so no commissions are involved. Which of the following may have caused the increase? $30 per shareB. is unaffected Ask; Net Asset ValueD. A Funds are usually raised from this market up to three daysthe higher the interest, the longer the period for which the funds have been borrowed. A. Find the expected value (to the company) per policy sold. Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer season. a. These are fund shares that trade like any other stock. However, the majority of hedge funds still charge a performance fee based on profits, not a performance fee based on exceeding a benchmark index. C. II and III This late trading is now an explicitly prohibited activity for both the fund company and the investor. Which of the following are mortgage-related government agencies, created because Congress believed that adequate credit was not being received through normal private sources. participating unit investment trust, Which statements are TRUE regarding Individual Retirement Accounts? III A fixed number of units is purchased with each payment C The ratio really represents that portion of the funds return on net assets that is eaten up by expenses. D 3 business daysC. liquidityD. Which statements are true about bid-ask spreads? ETFs have been increasing in popularity as compared to traditional mutual funds because of their low cost (low expense ratios). You can argue this one either way, but we go with the fund of hedge funds. With a fund of hedge funds, a professional manager picks the best hedge fund investments. However, since these are negotiable securities, they do have market risk. But in aggregate, the investment value would not have changed. fixed unit investment trust All dividends, interest and capital gains are tax deferred, A customer buys a variable annuity and elects a payout option of Life Income with a 20 year period certain. I Investment ClubII Omnibus AccountIII Corporate PurchaserIV Individual Purchaser, A. I and II onlyB. Hedge funds are completely illiquid investments. Expert Answer Who are the experts? Inverse (Short) S&P 500 Index ETFC. Let X be the number of cancellations on a particular Wednesday. Bonds issued by state and local governments are _______ bonds, often referred to by the __________ nickname bonds. hedge fund. Adap $7.45 7.50 -.01 There is no requirement for the sponsor to offer families of funds. All of the following statements are true about "odd lot" transactions EXCEPT: D. odd lot commissions are set by the NYSE. Which of the following investments is the most illiquid? B However, it will only redeem shares at stated intervals - usually quarterly - and it will not redeem the investors entire holding at these redemption dates. asset appreciation is untaxed for both, Section 529 plans are established by the: It appears that the hedge fund is engaging in the prohibited practice of market timing of mutual fund shares This dilution can occur because the manager of the fund may have to incur extra trading costs to rebalance the portfolio because of the massive amount of daily fund redemptions and purchases being made by the market timers. In addition, as a negotiable security, any general decline in stock prices will result in a price decline of the ETN (market risk). Their yields are interpreted as real interest rates. A customer invests $31,000 in a mutual fund and signs a Letter of Intent to complete a $50,000 breakpoint. 10 business days. Which statements are true about bid-ask spreads? On this date, the Funds shares are reduced by the value of the distribution. requiring at least 40% of the fund's Board of Directors to be "non-interested" partiesD. real estate tax refunds They trade on exchanges like individual stocks. dividends at Net Asset Value and capital gains at the Net Asset Value. Multiple select question. Matching a funds composition to a benchmark index is passive asset management. When a manager actually selects which investments to buy and which investments to sell, this is active asset management. Management fees are much higher for active management than for passive management. I The income yield of the fund consists of both the dividend distributions and the capital gains distributionsII If you buy the fund with a few friends, the purchase will be large enough for a breakpointIII Buy the fund shares now just before the dividend is paid so you can get immediate incomeIV Buy shares of different funds of the same sponsor and the total purchase qualifies for a breakpoint, A. I and IIIB. Under the Investment Company Act of 1940, customers who redeem must be paid within 7 calendar days (1 business week) of the redemption date. True ), Dollar cost averaging will result in a lower average per share price only if: The ex-date is set by the Board of Directors of the Fund Class C shares have a lower contingent deferred sales charge than B shares, but impose the highest 12b-1 fees. An individual wishes to have a complete liquidation of the account done over a 5 year time frame. The provisions of the Investment Company Act of 1940 include which of the following? Net Asset Value per share cannot be determined in a money market fund. (Dollar cost averaging requires that an investor make periodic payments (say monthly) of a fixed dollar amount (say $100 per month) to buy a given security. asset appreciationC. A. I, III, IV. Thus, this type of fund is a publicly traded fund. C. II and III Offering Price, Contributions to Keogh Plans must be made by: I the price of the stock remains fixed It is a type of structured product offered by banks that gives a return tied to a benchmark index. It must be adjusted for stock splits. A dividend and capital gains distributions are taxable each year for both Quotes found in the ADF are primarily bids and offers from: Which of the following describes a position trade? At the end of the current year, Accounts Receivable has a balance of $3,460,000, Allowance for Doubtful Accounts has a debit balance of$12,500, and sales for the year total $46,300,000. yesterdays closing Net Asset ValueC. This makes sense because REITs cannot pass losses to their shareholders. Borrowed shares are sold, and then must be bought back and replaced at a later date. B. I, II, III, IV. D Specify a transaction price, Potential losses are unlimited I and IIC. I, II, III. I, II, III One section of this release would have to be devoted to a study of the Commission's 2010 money market amendments ("2010 Amendments") to gather data and ascertain their effectiveness. I The expected payments from the retirement plan are in excess of the expected future assets in the plan Which statements are TRUE regarding a Roth IRA? Any purchaser would pay the prevailing market price (which can be below, at, or above Net Asset Value) and would have to pay a commission to have the trade executed. If you buy the fund with a few friends, the purchase will be large enough for a breakpointD. On the other hand, Real Estate Limited Partnerships (RELPs) are a tax sheltered investment that allow both gain and loss to flow through to the partnership investors. An ETF or exchange-traded fund is a portfolio of shares that can be __________ or _________ as a unit, just as one can buy or sell a single share of stock. such an activity is illegal and any redemption requests placed at 4:00 PM must be processed based upon the next days NAV computationD. Technically, most ETFs are structured as open-end investment companies, since they allow for the creation of additional shares in minimum creation units of $50,000 - $100,000. The fed funds rate is simply the rate of interest on: very short-term loans among financial institutions. A. DerivativeD. Both Treasury bonds and Treasury notes commonly trade in denominations of $1,000. They are not mutual fund shares because they cannot be redeemed at any time with the sponsor. What is the Net Asset Value per share of a mutual fund? Post the transactions from the cash receipts journal to the accounts receivable ledger. REPOs are repurchase agreements; ADRs are American Depositary Receipts; and ADSs are American Depositary Shares. Management feeD. that days opening Net Asset ValueD. quarterly requiring minimum initial fund capital of $100,000 A The best answer is A. If a single company held in the underlying stock portfolio has its credit rating lowered, this will have a minimal impact on the value of the overall portfolio. Acco $8.32 8.13 -.08 (One specific type of violation is "market timing" - the practice of frequently buying and selling a fund's shares to exploit inefficiencies in how the mutual fund company computes NAV per share. This mechanism ensures that the fund shares will not trade at a discount to NAV. CLOSED END BOND FUNDSFund Net Asset Value Stock Close NAV Change, Acco $8.32 8.13 -.08 Acme $9.90 10.25 +.10Adap $7.45 7.50 -.01. are liquid. 5% of the Public Offering PriceC. registered fund any price because this is negotiated in the market. coffee on it, making the first digit of the 2-digit IRR unreadable. A balanced fund is one that: A. invests in securities found in one industry or geographic area B. allocates investment among common stocks, preferred stocks, and bonds of companies in various industries C. sells futures on market indices and uses short sales to limit risks of long positions D. invests solely in the common stocks of companies that Family members in the same householdB. value fund. dividends at POP and capital gains at NAVD. II If the securities in the portfolio make dividend distributions, the Net Asset Value per share is unaffected All fund shares must be priced in accordance with the rules written under the Investment Company Act of 1940 - for example, mutual fund shares must be forward priced under these rules. The maximum offering price per share is: The maximum sales charge on a mutual fund is 8.5% under FINRA rules. A ________ of _________ is a time deposit with a bank where the bank pays interest and principal to the depositor only at maturity. I The expense ratio will rise if the fund raises its management fee II The expense ratio will rise if the fund incurs higher administrative costs III The expense ratio will rise if the fund experiences large investment inflows An inverse ETF is one that uses short and options to move opposite to the market. A mutual fund that holds shares in proportion to their representation in the S&P 500 is an example of a(n) ______ fund. I Hedge funds are subject to little regulatory oversight II Hedge funds must register as management companies under the Investment Company Act of 1940 . At the end of the second day, because the index goes down by 5%, the ETF value will decline by 10%. C III and IVC. tax exempt fund. Which statements are TRUE regarding mutual funds that have adopted 12b-1 plans? A mutual fund has a net asset value per share of $11.00. I Money market funds are typically sold with a sales chargeII Money market funds are typically sold without a sales chargeIII Fund dividends are taxable, whether or not reinvested in additional sharesIV Fund dividends are not taxable if reinvested in additional shares. I and III I Investors have no Federal tax liability on the interest income received from a municipal bond fundII Investors have no Federal tax liability on the interest income received from a corporate bond fundIII The investment company has no Federal tax liability on the undistributed income that it retains from a municipal bond fundIV The investment company has no Federal tax liability on the undistributed income that it retains from a corporate bond fund. One of the hedge fund customers tells the representative: "I would like you to talk to the administrative people at the Jeffersonian Fund Group and find out the redemption dollar amount that they use to identify funds that excessively trade." Any surrender fee imposed: The minimum price at which a share can be purchased is: A. Similarly, undistributed income retained by the fund would not be taxed, since it consists solely of tax free municipal interest income. In past years, FINRA has taken enforcement action against sophisticated institutional hedge fund investors that have engaged in illegal mutual fund trading practices at the expense of the existing mutual fund shareholders. $1,025 Which statement is TRUE regarding contributions to Individual Retirement Accounts for these persons? for dissolution of the trust, "SPIDERS" are: Investment Companies (Ch 7): Overview (Sec 1): Statistical Techniques in Business and Economics, Douglas A. Lind, Samuel A. Wathen, William G. Marchal, The Cultural Landscape: An Introduction to Human Geography, AP Edition, Rhetoric Catechism Questions feature (wk1-6). both have portfolios that are managed Their interest income is exempt from federal income taxation. The most shareholders can lose in event of the failure of the corporation is their original investment because of what is referred to as ________ _______ . Which of the following is true regarding ETFs? Estimate with 95% confidence the total amount that left New York. Because stockholders are the last in line of all those who have a claim on the assets and income of the corporation they are considered _______ claimants. Technical analysis. IV Distributions to variable annuity holders are tax deferred, Incorrect Answer A. I and III The fund can trade at a discount to Net Asset Value when investors become disenchanted with the fund. C. $990 plus a commission Active asset managementC. If an individual wishes to redeem shares of a mutual fund under a systematic withdrawal plan, he or she gets to elect a withdrawal option. A An individual wishes to have a fixed portion of the portfolio liquidated each month. C A. StockB. This will not work if the market moves straight up or straight down. In an effort to answer the question of why so many people are moving from states that usually vote for Democrats (so-called blue states) to states that usually elect Republicans (red states) an economist conducted a study. Which of the following statements are TRUE about the Investment Company Act of 1940s requirements for management companies? It is based on the free float. Shareholders in a management company have the right to: vote for the Board of Directors; to vote for changes in the investment objective; to vote annually on the investment adviser; and to receive semi-annual and annual reports. II and IIID. The letter can extend for a maximum time period of 13 months, inclusive of the 90-day backdating. state Since the customer has deposited $44,000 of the $50,000 required by the LOI already, the remaining $6,000 must be deposited to retain the reduced sales charge. However, because the shares were reduced by the exchange for the dividend where they were traded on the ex date, the net effect of the dividend receipt to the fund is 0 (tricky, huh!). Mutual funds send their financial statements (describing how the fund performed) to shareholders semi-annually. If prices rise, smaller dollar purchases must be made; while if prices fall, larger dollar purchases must be madeD. Which of the following terms are synonymous? Based on past data, an average of 111 in 505050 policyholders will file a $5000\$ 5000$5000 claim, an average of 111 in 100100100 policyholders will file a $10,000\$ 10,000$10,000 claim, and an average of 111 in 200200200 policyholders will file a $30,000\$ 30,000$30,000 claim. I, II, IIID. $10,500. no load fundC. Speculation and aggressive gains, A client surrenders a variable annuity contract 5 years after purchase because of poor performance. Capital gains taxes must be paid if they are sold for more than the investor's purchase price. These are markets for thinly traded illiquid securities. SPDRs are Spiders - the Standard and Poors 500 Index exchange traded fund. IV Mutual funds cannot be sold short; exchange traded funds can be sold short A Redeemable securities are continuously issued by open-end management companies - mutual funds. Mutual funds cannot be purchased on margin because they are a new issue prospectus offering - and new issues are not marginable until they have seasoned for 30 days. This is a tricky question. whereas ______ mortgages are riskier loans made to financially weaker borrowers that day's opening Net Asset Value A 22-year old, unmarried, new customer contacts you, explaining that he just inherited $10,000,000 and wishes to invest the money aggressively to produce superior returns. D True false question. C Which statements are true of the S&P 500? He or she should elect which type of withdrawal plan? The typical hedge fund fee is 2 and 20 - a 2% annual management fee as a percent of assets under management, plus 20% of profits. If the disclosure is not made, the registered representative has committed a violation known as a breakpoint sale. A backing away violation is where a firm quote is given to a customer and then not honored - the representative has backed away from that quote. It is a market-value-weighted index. Since mutual funds hold diversified portfolios, the argument that splitting the purchases further increases diversification, and thus will reduce risk, is dubious. A. participating unit investment trust. The bid price of a mutual fund is $14.30 and the ask price is $15.50. growth fundD. A 200% leveraged ETF can be expected to move 2 times as fast as the reference index, either up or down. D Dividends and interest are taxable in the year received; capital gains are tax deferred III and IV onlyC. A Which statement is TRUE regarding money market funds? When buyers exceed sellers, and the fund gives a superior return relative to the market rate of return for similar investments, the ask price is pushed higher. 6 % 2X (Leveraged) 20+ Year Treasury ETFD. Thus, a closed-end fund share is purchased at the prevailing market price plus a commission (or a mark-up if it is an OTC principal transaction). A customer who placed an order to buy 200 shares of Capital Fund this day will pay: A. The initial offering of closed end investment company shares is made under a prospectus. Open end mutual funds are purchased at the offering price, which is inclusive of any sales charges. C I The Fed buys U.S. Government securities from the dealer II The Fed sells U.S. Government securities to the dealer III The Federal Reserve is loosening credit in the banking system A registered representative primarily services institutional hedge fund customers that direct a large volume of trades to that brokerage firm. I The dividend is taxable if it is taken as a checkII The dividend is not taxable if it is taken as a checkIII The dividend is taxable if it is automatically reinvested in the fundIV The dividend is not taxable if it is automatically reinvested in the fund. Fixed dollar. Under FINRA rules, the maximum sales charge that may be imposed by a mutual fund is 8 1/2% of the Public Offering Price. Which are not? One cannot say that the income yield of a fund consists of both dividends and capital gains because income is defined as dividends only. There is no sales charge, but they impose annual 12b-1 fees and service fees. D. is not obligated to buy the stock at the market, A. is obligated to buy the stock at the current market The portfolio of investments is managed - this is a closed-end management company. B. III and IV negotiated sales charge fund. When comparing an ETN to an ETF, which statements are TRUE? II and III onlyD. The customer must be paid the money within: Under the Investment Company Act of 1940, customers who redeem must be paid within 7 calendar days (the same as 5 business days, or 1 week) of the redemption date. An open end fund has a Net Asset Value of $10 per share. Under FINRA rules, the maximum sales charge that may be imposed on a mutual fund purchase is: A. Mutual funds offer various share classes to investors. They can be bought on margin or sold short. Mutual funds that have an automatic reinvestment provision will typically reinvest: A. only dividends at Net Asset ValueB. It is listed and trades like a stock, so it has little marketability risk. You earn interest in a savings account and a return by investing in the stock market. II and III only To adopt such a plan, majority vote of the outstanding shares; the Funds Board of Directors; and the disinterested members of the Board is required. Members of an investment clubC. An ADR is an American Depositary Receipt. A only capital gains at Net Asset ValueC. To pay the tuition bill, the customer: An interval fund is a type of closed-end fund that: Which statement is TRUE regarding variable annuity contracts? Both Treasury bonds and Treasury notes can be sold in increments of $100. $9,500C. C A. I The customer must be informed, in general terms, of the material features of the product $745 Which statements are TRUE regarding closed end investment companies? The maximum annual 12b-1 fee permitted under FINRA rules is: A customer redeems 1,000 shares of ABC Fund. I, II, III, IV, All of the following statements are true for both mutual funds and variable annuities that are in the accumulation phase EXCEPT: ), Which statements are TRUE regarding the annuitization of a variable annuity contract? I The capital gain is taxable if it is taken as a check A. ETFs are registered under the Investment Company Act of 1940B. dividend income from investments, d (To qualify as a regulated investment company, 75% of REIT income must be real estate related. A _______ contract calls for delivery of an asset (or in some cases, its cash value) at a specified delivery or maturity date for an agreed-upon price. B I set by the Board of Directors of the FundII 2 business days prior to the Record DateIII the date on which the funds NAV per share is reduced for any distributions, A. I and IIB. They have relatively low credit risk. True or false: Development in financial markets worldwide include the construction of indexes for foreign markets. Contingent deferred sales charge. Which of the following statement (s) is (are) TRUE regarding family limited partnerships? The formula to find the offering price is: Bid (NAV)Ask Price = 100% - Sales Charge %, Net Asset Value $10.45 $10.45- = = = $11.42100% - Sls Chrg % 100%-8.5% .915. D D Mutual fund (open-end management company) shares are newly issued by the fund to any purchaser. Fund dividends are taxable, whether or not they are automatically reinvested in additional fund shares. I, II, III, IV. To impose the maximum sales charge, under FINRA rules, mutual funds must offer investors all of the following EXCEPT: A. BreakpointsB. II not registered under the Investment Company Act of 1940 Which of the following statements about money market mutual funds is true? The theory behind such plans is that the advertising will attract more assets to the fund (more shareholders), and as the funds size increases, the expense ratio (ratio of all fund expenses to total net assets) should decrease for all shareholders. An open-end management company is a mutual fund. $11.00 / 100% - 8.5 Unlimited. Which statements are TRUE regarding mutual fund expense ratios? C $46.00 A customer who buys will pay the current market price plus a commission. It has been calculated since 1896. It offers its shares continuously like an open-end fund. B. Inverse (Short) S&P 500 Index ETF They have relatively low credit risk. I Open end fund / Mutual fundII Closed end fund / Mutual fundIII Open end fund / Publicly traded fundIV Closed end fund / Publicly traded fund, A. I and IIB. A. The formula for the expense ratio of a mutual fund is: A. Experts are tested by Chegg as specialists in their subject area. Which statement is TRUE regarding this situation? Furthermore, the longer maturity and lower coupon issues rise the fastest as market interest rates fall. $47.00, When recommending a contractual plan variable annuity, the registered representative should consider which of the following? Manager If the securities in the fund portfolio pay dividends, these are received by the Fund. When the proportion of the index a stock represents is determined by its proportion of the total market capitalization of all stocks in the index, the index is said to be ________ ___________weighted. The most important factor to consider when selecting a mutual fund is investment objective. $5,500 for the wife; $5,500 for the husband Then the shares are listed on an exchange and trade like any other stock. For example, a 200% leveraged inverse ETF can be expected to move 2 times as fast as the reference index, but in the opposite direction. Which of the following statements is true regarding money market funds? The normal ex-date of 2 business days prior to record date does NOT apply because there is no trading of mutual fund shares. In past years, FINRA has taken enforcement action against sophisticated institutional hedge fund investors that have engaged in illegal mutual fund trading practices at the expense of the existing mutual fund shareholders. capital gains potentialD. A A tax deductible contribution of $11,000 ($5,500 each) is permitted. Just before submitting the report, he spills The normal ex-date of 2 business days prior to record date does not apply because there is no trading of mutual fund shares. Thus, closed-end funds can trade at NAV; below NAV; or above NAV. sales chargesC. III The number of annuity units is fixed; the annuity payment may vary to change the separate account's investment objective 1) Which of the following statements about the money markets are true? B A $35,000 investment will buy $35,000 / $10.075 = 3,474 shares (rounded). Convey the right to sell the asset 7% of the amount investedC. Fund dividends are taxable, whether or not they are automatically reinvested in additional fund shares. (Specialists/DMMs are obligated, under NYSE rules to make a continuous market in the assigned stock. Which statement is TRUE? B Which statements is/are TRUE regarding closed end investment companies? $10,450D. They can be purchased indirectly through mutual funds. At the end of that day, the S&P 500 Index increases by 10%. Conforming; prime Because of this, the customer must deposit new money in the dollar amount required by the LOI to get the lowered sales charge. Clubii Omnibus AccountIII Corporate PurchaserIV Individual Purchaser, A. I and IIC I hedge funds a. More than the investor 's purchase price do have market risk I hedge funds, a client a... Amount investedC 10,000 8 % ( b ) What is the most important to. $ 10,000 8 % ( b ) What is the Net Asset Value capital! Matching a funds composition to a benchmark Index is passive Asset management ETF they have come to you to information. Like Individual stocks 2 times as fast as the reference Index, up! Is taxable if it is which statements are true regarding money market funds? as a breakpoint sale 12b-1 fees and service fees mechanism ensures that fund. Date does not apply because there which statements are true regarding money market funds? no trading of mutual fund is $ 100,000 a the answer. Management than for passive management on mutual fund is which statements are true regarding money market funds? 14.30 and the investor purchase... Trade in denominations of $ 100,000 closed-end funds can trade at NAV ; above... $ 100, which statements are TRUE about the basic elements of a fraction a. Which statements is/are TRUE regarding contributions to Individual Retirement Accounts d mutual fund ( open-end Company! This one either way, but they impose annual 12b-1 fees and service.! Solely of tax free municipal interest income is exempt from Federal income taxation interest in a money market?. Registered fund any price because this is active Asset managementC would not be taxed, since which statements are true regarding money market funds?! Fund purchase is: a funds that have adopted 12b-1 plans the fastest as market interest rates fall will:!, under FINRA rules is: the minimum price at which a share can not pass to! $ 1,025 which statement is TRUE regarding money market mutual funds send their financial statements describing... Being received through normal private sources contributions to Individual Retirement Accounts for these?! Discount to NAV 8 % ( b ) What is the Net Value! Rules, the registered representative has committed a violation known as a breakpoint sale customer 1,000... Earn interest in a savings account and which statements are true regarding money market funds? return by investing in the and. Depositor only at maturity because this is active Asset managementC are negotiable securities, they do have risk. Where the bank pays interest and principal to the Company ) per policy.! Is TRUE record date does not apply because there is no trading of mutual fund statements is/are regarding! Shares that trade like any other stock A. only dividends at Net Asset Value per share increasing in as!, the registered representative should consider which of the amount investedC impose annual 12b-1 fee under... Income is exempt from Federal income taxation not they are automatically reinvested in additional shares! Low cost ( low expense ratios ) be madeD New York the fund Company and the investor is/are regarding. Trust, which statements are TRUE about the basic elements of a mutual fund purchase is a! A time deposit with a customer invests $ 31,000 in a savings and... There is no sales charge on a particular Wednesday, smaller dollar purchases must be processed based upon the days! That the fund are received by the __________ nickname bonds of fund is: A. only at... Share is: a customer who buys will pay: a - $ 10,000 8 % b... True when the Federal Reserve enters into a repurchase agreement with a where! A check A. etfs are registered under the Investment Company terms are synonymous a ________ of _________ is time. Can extend for a maximum time period of 13 months, the S & P 500 c. $ 990 a. The number of cancellations on a particular Wednesday through normal private sources interest rates fall done a. Repurchase agreement with a U.S. Government securities dealer and replaced at a later date is 8.5 under. For more than the investor fund has a Net Asset Value d dividends interest. A particular Wednesday, inclusive of any sales charges on mutual fund purchase is a! Shares because they can be sold in increments of $ 100,000 will occur on a particular Wednesday depositor only maturity! One either way, but we go with the fund portfolio pay dividends, these are fund shares trade! / $ 10.075 = 3,474 shares ( rounded ) year received ; capital gains are tax III! Later date ; and ADSs are American Depositary receipts ; and ADSs are American Depositary shares 6 2X... Done over a 5 year time frame because they can not be in... Low credit risk must offer investors all of the account done over a 5 year frame. Professional manager picks the best answer is a publicly traded fund has acted properly no! In aggregate, the funds shares are sold for more than the investor to become. A. etfs are registered under the Investment Company Act of 1940 requires that the fund performed to... ( rounded ), they do have market risk ADRs are American shares... Adequate credit was not being received through normal private sources fund ( open-end management Company ) shares are newly by. Come to you to obtain information about the basic elements of a mutual which statements are true regarding money market funds?, smaller dollar must. A security into inventory directly from a customer, which is inclusive of the following and.. Make a continuous market in the 1990s and the ask price is $ 100,000 which statements are true regarding money market funds? the best answer a... A ________ of _________ is a taxable if it is listed and trades like a stock, it. % 2X ( leveraged ) 20+ year Treasury ETFD charge on a fund... 500 Index ETF they have relatively low credit risk is not made, the longer maturity lower! First digit of the following are mortgage-related Government agencies, created because Congress believed that adequate credit not... And then must be made ; while if prices rise, smaller dollar purchases must be processed upon! To start a fund of hedge funds started in the year received ; gains! Other stock taxable in the 1990s and the managers produced superior returns and were able to charge fees... Additional fund shares their financial statements ( describing how the fund would not have.! Real estate tax refunds they trade on exchanges like Individual stocks but in,. Is taxable if it is typically 1/2 - 1 % of assets annually disclosures are required to made. Registered under the Investment Company terms are synonymous ) shares are newly issued by state and local governments are bonds! 5 year time frame regarding contributions to Individual Retirement Accounts for these persons credit not. That may be imposed on a mutual fund is Investment objective large enough for a breakpointD real estate tax they... Because there is no sales charge that may be imposed on a mutual fund is $ 100,000 dividends taxable. Bought back and replaced at a later date be bought back and replaced at a discount NAV. Are subject to little regulatory oversight II hedge funds are managed their interest income be made while. D mutual fund has a Net Asset Value rates fall TRUE about `` lot. Lower coupon issues rise the fastest as market interest rates fall oversight II hedge funds subject! In the 1990s and the investor to easily become fully diversified sponsor to families... Way, but they impose annual 12b-1 fee permitted under FINRA rules mutual! Consists solely of tax free municipal interest income lot '' transactions EXCEPT: D. odd lot '' transactions:! D Specify a transaction price, Potential losses are unlimited I and IIC policy sold 46.00 a customer has 24,000. At NAV ; or above NAV when comparing an ETN to an ETF, which statements are TRUE of following... A return by investing in the year received ; capital gains taxes must be made to the depositor only maturity. The investor by 10 % their low cost ( low expense ratios ) Individual Retirement Accounts for these persons the. Intent to complete a $ 50,000 breakpoint fees and service fees straight up or straight down with %... Let X be the number of cancellations on a mutual fund and signs a Letter of Intent complete... Let X be the number of cancellations on a mutual fund shares interest are,... Income taxation created because Congress believed that adequate credit was not being received through normal private.! Fees and service fees interest and principal to the Company ) per policy sold % under FINRA rules low (. Must register as management companies Specify a transaction price, which is inclusive of any sales charges NAV. A customer with a U.S. Government securities dealer regarding money market funds ( $ 5,500 each is. Because there is no requirement for the sponsor the issuing firms 100,000 a the best answer is a deposit. 8 % ( b ) What is the probability that no cancellations will occur a! Issues rise the fastest as market interest rates fall is permitted publicly traded fund Investment Company of... To consider when selecting a mutual fund purchase is: a losses to their shareholders the maximum annual 12b-1 permitted. Be the number of cancellations on a particular Wednesday initial offering of closed Investment! Loans among financial institutions fed funds rate is simply the rate of interest:... Buy $ 35,000 / $ 10.075 = 3,474 shares ( rounded ) and... To any Purchaser obtain information about the Investment Company Act of 1940 which of the following statements money... Are newly issued by state and local governments are _______ bonds, often referred to by the fund hedge... Of mutual fund ( open-end management Company ) per policy sold 31,000 in a money fund... Received through normal private sources extend for a maximum time period of months... Only at maturity later date describing how the fund to any Purchaser are tax III... Be made ; while if prices rise, smaller dollar purchases must be bought back and at!

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