Exam 13: Investing in Mutual Funds

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A [global | international] fund invests exclusively in foreign securities.

Low-load funds do not charge a commission upon initial purchase.

Speculating in raw land is a low-risk investment approach.

Exchange-traded funds have characteristics of both closed-end and open-end funds.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The securities owned by a mutual fund are in the custody of [the management company | an independent bank].

Loads are transaction charges for mutual funds.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -"Mutual fund" technically refers to [an open-end | a closed-end] investment company.

An investor with a small amount of money should stick to using load funds instead of no-load funds.

The primary purpose of investing in income property is to produce an attractive annual cash flow.

A fund that invests only in a particular industry would be a ____ fund.

A closed-end investment company that invests in various types of real estate and mortgages is a

Advantages of exchange-traded funds over mutual funds include all of the following except

A guarantee of expected fund's future performance is its past performance.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -George purchased a large piece of undeveloped land that he plans to hold for future development.This is an example of [?speculating in raw land | ?investing in income property].

All mutual funds have management fees.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -One type of [stock | bond] fund provides tax-free income.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -You can lose money in a mutual fund because of [fraud of the management company | a downturn in the market].

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Advantages of exchange-traded funds over mutual funds include [lower | higher] expense ratio.

The fund whose main objective is to simply match the market known as a(n)____ fund.

Balanced funds invest in a proportionate amount of common and preferred stocks and bonds.