Exam 4: Mutual Funds and Other Investment Companies

The High Yield Money Market Fund returned 6.60% for the last year. Currently, you own 8,901.1 shares of this fund. If you invested in this fund one year ago, what was the amount of your original investment?

If a growth mutual fund has $5,234,000 in assets, $1,234,000 in liabilities, and an NAV of $22.22 per share, what is the number of outstanding shares in the fund?

At the beginning of the year, you invested $7,500 in a no-load mutual fund with an NAV of $30.00. At the end of the year, the fund distributed $1.05 per share in short-term earnings and $3.00 per share in long-term earnings. The end-of-year NAV was $24.75. What was your annual rate of return on this investment?

Money market mutual funds do which one of the following?

Small-cap funds:

Six years ago, you purchased 210.20 shares of a mutual fund. Since then, you have reinvested your fund dividends and acquired an additional 36.32 shares. The fund currently has an NAV of $38.95. The fund charges a contingent deferred sales charge of 5% for the first 2 years after which time the charge declines by 1% a year. How much money will you receive if you redeem all your shares today?

Renee wants to invest in a bond fund. She is a very conservative investor with a high marginal tax rate. Which one of the following types of bond funds might be most suited for her situation?

The Blue Star Fund has assets with a market value of $8.6 million and liabilities of $513,000. What is the net asset value if there are 163,000 shares outstanding?

Jack has managed to save $1,000 and wants to start investing. The financial markets make him nervous as he has very limited financial resources. Which one of the following types of funds is probably best for Jack at this time?

The Viking Fund has an offering price of $76.21 per share and an NAV of $74.88 per share. What is the front-end load percentage?

If you purchase shares in a closed-end fund at the initial offer price, you should expect to:

Clark purchased 227 shares of a mutual fund with an offering price and NAV of $35.03 per share a year ago. Today, the NAV is $33.52 per share and the fund has just distributed $3.23 per share in long-term gains. What is Clark's rate of return?

Western States Mutual Fund sold $89.5 million of assets during the year and purchased $82 million of new assets. The average daily assets of the fund were $273 million. What is the fund's turnover rate for the year?

Shares in closed-end funds:

A 12b-1 fee is a fee charged by a mutual fund:

Alex invested $10,000 in a mutual fund two and one-half years ago when the NAV of the fund was $25. Today, the NAV has risen to $28.30. Since the time of his original investment, Alex has obtained an additional 54.36 shares by reinvesting the fund distributions. The fund charges a contingent deferred sales charge of 6% the first year with the charge decreasing by 1% each year. How much money will he receive if he redeems his shares today?

The turnover for a mutual fund refers to:

Mutual fund trading costs:

The Colgate Mutual Fund has an NAV of $27.23 per share with 150,200 shares outstanding. What is the value of the fund's assets if it has $503,400 in liabilities?

The Aggressive Eastern Fund sold $278 million of assets during the year and purchased $295 million of new assets. The average daily assets of the fund were $438 million. What is the turnover rate?