Exam 5: Mutual Funds, Hedge Funds, and Pension Funds

An open-ended fund has stocks of three companies: 200 shares of IBM currently valued at $50.00, 100 shares of GE currently values at $20 and 100 shares of Digital currently valued at $30. The fund has 500 shares outstanding. What is the net asset value (NAV) of the fund?

The NAV of a closed-end investment company shares is determined at any point in time by

Which of the following is true about the values of most money market mutual fund shares?

Which of the following hedge fund objectives would be classified under the "more risky" category?

The net asset value of a mutual fund is found by

The hedge fund industry is built on the theory that

Mutual funds are financial intermediaries that invest in diversified portfolios of assets.

The net asset value of a mutual fund is determined four times each business day.

An investor purchases fund shares with a 3 percent front-end load and expects to hold the shares for 10 years. The annualized sales load incurred by the investor is _______ per year.

Open-end mutual funds are the major type of mutual funds.

The rate of investing in mutual funds tends to be positively correlated with economic activity in Canada, but is negatively correlated with economic activity in other countries.

Which of the following observations concerning hedge funds is NOT true?

The long-term mutual fund sector includes

Directed brokerage is a trading abuse where a mutual fund and a brokerage agree to promote sales of certain funds in exchange for orders of specific stocks and bonds.

Short-term mutual funds invest solely in tax-exempt securities.

Since 2002, the amount of assets invested in load funds have exceeded those invested in no-load funds.

Eveningstar open-end fund has 1,000 shares outstanding and has the following assets in its portfolio: 100 shares of Procter & Gamble (P&G) priced at $30.00, 300 shares of Intel priced at $50.00 and 200 shares of Microsoft priced at $60.00. The Morningstar closed-end fund has the following stocks in its portfolio: 300 shares of P&G and 300 shares of Microsoft. It has a total of 500 shares outstanding. To what level should the price of Microsoft shares decline in order for the NAV of Morningstar fund to remain constant if the price of P&G rises to $40?

Duties of a mutual fund chief compliance officer include

Which practice is especially common in international funds as traders can exploit differences in time zones?

It is estimated that 75 percent of all hedge funds are located in