Question 11 pts
A collective investment that pools together the money of a large number of investors to purchase a wide variety of securities like stocks and bonds is called a mutual fund. When you purchase a share you have a stake (participate in gains and losses) in all investments included in the fund. A single mutual fund investment can mirror an entire portfolio of stocks.
True
False
Question 21 pts
Benefits of a mutual fund include diversified investments but not professional management
True
False
Question 31 pts
Most active management mutual funds survive and beat their benchmark
True
False
Question 41 pts
Possible mutual fund fees include management and transaction fees and charges to buy or sell shares
True
False
Question 51 pts
In both stock and mutual fund investments you can make money either through capital appreciation and/or dividends
True
False
Question 61 pts
Despite its name actively managed funds follow an index so there is no active management
True
False
Question 71 pts
Like stocks, mutual funds have annual reports
and
unlike mutual funds, stocks do not have prospectuses and do not trade on an exchange (but rather shares are purchased and redeemed directly with the mutual fund company)
True
False
Question 81 pts
Exchange traded funds (ETFs) (the result if an index fund and a stock got married and had children) typically replicate a stock market index or market sector, are not actively managed, have lower management fees and are more tax efficient than mutual funds. ETFs trade on an exchange at any time during the day.
True
False
Question 93 pts
In July, you purchase 200 shares of an international mutual fund, paying $33 per share. In December, you sell those 200 shares for $30 per share.
a) How much did you make?
b) What was your ROI?
Group of answer choices
a) $600 / b) 9.09%
a) -$600 / b) -9.09%
a) -$600 / b) 9.09%
a) -$600 / b) 10%
a) -$600 / b) -10%
Question 101 pts
Mutual fund benefits include:
– diversification
– stock ownership and
– professional management
True
False
Question 111 pts
If fund managers do not perform well they still get paid
True
False
Question 121 pts
When a fund’s assets fall in value the fund shares increase
True
False
Question 131 pts
Fixed income funds buy stocks
True
False
Question 141 pts
Mutual funds should not be used for long term goals such as retirement or college savings investing
True
False
Question 151 pts
Diversified portfolios help to achieve steadier results
True
False
Question 161 pts
Knowing your risk tolerance, time horizon and financial goals can help shape financial investment decisions for your individual situation
True
False
Question 171 pts
Attributes of ETFs include
– trading on an exchange,
– cost and
– tax efficiency
True
False
Question 181 pts
Fees in passive investing, which seeks to match the performance of an index, are higher than fees in active investing
False