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Exam 15: Mutual Funds and Exchange Traded Funds

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Question 21

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The SEC requires that a mutual fund's profile prospectus include an estimate of the future rate of return for the fund.

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Question 22

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Emerging market funds are volatile because the countries the stocks are in tend to be less stable politically.

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Question 23

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A trailing commission is compensation paid to salespersons for months or years in the future.

The typical growth fund seeks short-term capital appreciation.

A standardized expense table must be included in the front portion of a mutual fund's

No-load mutual funds are appropriate for investors who want to buy investments through a broker or financial planner.

Of the following types of stock funds,____ funds tend to be the least risky.

Bond funds are always low-risk investments.

Mutual funds are readily available to people saving for retirement through 401(k) plans and IRAs.

A mutual fund whose objective focuses on growth in the value of the securities invests in companies expected to show average or better growth with steady or rising dividends.

Individuals trade open-end fund shares on an organized exchange.

Volatility is a mutual fund's tendency to rise and fall in price over a period of time.

A global fund invests in growth stocks of companies listed on foreign exchanges as well as in the United States.

Mutual fund investors expect to profit from their investments through the receipt of mutual fund dividends and

Your first task in selecting a mutual fund is to

More than 90 percent of all mutual funds are open-end funds.

A money market fund will have an income rather than growth objective.

Mutual funds will accept direct transfers of a portion of a worker's paycheck towards the purchase of shares in the mutual fund.

Most mutual funds are managed funds.

A mutual fund that has an income objective as its primary focus aims to earn regular income in dividends or interest from the investments in its portfolio.