Exam 4: Mutual Funds and Other Investment Companies

You invest in a mutual fund that charges a 3% front-end load, 1% total annual fees, and a 0% back-end load on Class A shares. The same fund charges a 0% front-end load, 1% total annual fees, and a 2% back-end load on Class B shares. What are the total fees in year 1 on a Class B investment of $20,000 if you redeem shares with no growth in value?

A mutual fund has total assets outstanding of $69 million. During the year the fund bought and sold assets equal to $17.25 million. This fund's turnover rate was ________.

Consider a no-load mutual fund with $200 million in assets and 10 million shares at the start of the year and with $250 million in assets and 11 million shares at the end of the year. During the year investors have received income distributions of $2 per share and capital gain distributions of $.25 per share. Assuming that the fund carries no debt, and that the total expense ratio is 1%, what is the rate of return on the fund?

Which type of fund generally has the lowest average expense ratio?

From 1971 to 2013 the average return on the Wilshire 5000 Index was ________ the return of the average mutual fund.

The NAV of which funds is fixed at $1 per share?

In a recent study, Malkiel found that evidence of persistence in the performance of mutual funds ________ in the 1980s.

________ funds stand ready to redeem or issue shares at their net asset value.

Which of the following funds are usually most tax-efficient?

The ratio of trading activity of a portfolio to the assets of the portfolio is called the ________.

Which of the following is not a type of managed investment company?

The assets of a mutual fund are $25 million. The liabilities are $4 million. If the fund has 700,000 shares outstanding and pays a $3 dividend, what is the dividend yield?

The offer price of an open-end fund is $18 and the fund is sold with a front-end load of 5%. What is the fund's NAV?

According to the 2017 Mutual Fund Fact Book, ________ of total assets were in taxable money market funds and ________ were tax-exempt money market funds.

An official description of a particular mutual fund's planned investment policy can be found in the fund's ________.

An open-end fund has a NAV of $16.50 per share. The fund charges a 6% load. What is the offering price?

Consider a mutual fund with $300 million in assets at the start of the year and 12 million shares outstanding. If the gross return on assets is 18% and the total expense ratio is 2% of the year-end value, what is the rate of return on the fund?

Mutual funds that hold both equities and fixed-income securities in relatively stable proportions are called ________.

The primary measurement unit used for assessing the value of one's stake in an investment company is ________.

Assume that you have recently purchased 100 shares in an investment company. Upon examining the balance sheet, you note that the firm is reporting $225 million in assets, $30 million in liabilities, and 10 million shares outstanding. What is the net asset value (NAV) of these shares?