What is the difference between the SEC and FINRA as regulators? Why do we give regulatory power to FINRA and not the ICI?
Materials: The Mutual Fund Business By Robert Pozen
What is the difference between the SEC and FINRA as regulators? Why do we give regulatory power to FINRA and not the ICI?
Materials: The Mutual Fund Business By Robert Pozen
Related questions
Question 11
Advantages of mutual funds include
| A. | professional management. | |
| B. | all of these. | |
| C. | liquidity. | |
| D. | diversification. |
Question 12
Which of the following types of investment companies operates much like an index fund?
| A. | exchange-traded fund | |
| B. | unit investment trust | |
| C. | closed-end fund | |
| D. | REIT |
Question 13
A common stock fund that invests in only one industry is called a(n) ____ fund.
| A. | maximum capital gains | |
| B. | growth and income | |
| C. | index | |
| D. | sector |
Question 14
Mutual funds that charge a load do so to compensate
| A. | fund managers. | |
| B. | brokers. | |
| C. | shareholders. | |
| D. | the SEC. |
Question 15
Your first task in selecting a mutual fund is to
| A. | review your investment policy. | |
| B. | locate sources of comparative performance data. | |
| C. | eliminate funds inappropriate for your investment goals. | |
| D. | screen and compare funds that meet your investment criteria. |
Question 16
Taxes on annual earnings from mutual funds can be avoided
| A. | while those amounts are kept in an IRS-qualified retirement account. | |
| B. | as long as the mutual shares are not sold. | |
| C. | while those amounts are kept in an IRS-qualified retirement account and if those earnings are interest from municipal bonds. | |
| D. | if those earnings are interest from municipal bonds. |
Question 17
Mutual funds permit automatic income reinvestment of
| A. | ordinary income dividend distribution. | |
| B. | none of these. | |
| C. | both ordinary income dividend distributions and capital gains distributions. | |
| D. | capital gains distribution. |
Question 18
The type of mutual fund that is not actively managed is called a(n) ____ fund.
| A. | emerging market | |
| B. | money market | |
| C. | index | |
| D. | sector |
Question 19
A mutual fund that does not assess a sales charge at the time of the investment purchase is called a ____ fund.
| A. | back-end load | |
| B. | front-end load | |
| C. | low-load | |
| D. | no-load |
Question 20
Open-end mutual funds
| A. | make up about 75 percent of all mutual funds. | |
| B. | are sold only through brokers. | |
| C. | are sold at their current net asset value. | |
| D. | are sold to other investors on a secondary market. |
| A mutual fund manager expects her portfolio to earn a rate of return of 10% this year. The beta of her portfolio is .7. The rate of return available on risk-free assets is 4% and you expect the rate of return on the market portfolio to be 14%. |
| What expected rate of return would you demand before you would be willing to invest in this mutual fund? (Do not round intermediate calculations. Enter your answer as a whole percent.) |
| Expected rate of return | % |
| Is this fund attractive to you? | ||||
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