Term
| Unit Investment Trust, Face Amount Certificate, and Management Companies |
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Definition
| The Investment Company Act of 1940 classifies investment companies into what three categories? |
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Term
| Average investors usually lack sufficient resources to adequately diversify their portfolios, but gain the advantage of wide diversification by pooling their funds with those of similar investors with like objectives. |
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Definition
| What primary advantages do investment companies offer to the individual investor? |
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Term
| The investment portfolio musb be invested in a specificed manner in order for a company to qualify as diversified. |
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Definition
| What is the difference between a diversified management company and a non-diversified manaement company? |
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Term
| The investment adviser is paid a fee for advisory services that is typically based on a percentage of the net asset value under management over a specific period of time. |
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Definition
| What are the functions of an elected investment adviser of a mutual fund's portfolio? |
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Term
| The expense ratio is of total expenses to assets (Total expenses / Total Net Assets) |
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Definition
| The cost of operation of a mutual fund may be expressed as the fund's expense ratio. What is the expense ratio, and how is it calculated? |
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Term
1) Voting Rights/Proxies
2) Approve changes in investment objectives and policies
3) Approve investment advisory agreement
4) Elect directors
5) Annual/semiannual reports |
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Definition
| What are the shareholder's rights within a mutual fund? |
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Term
1) Day-to-Day investment decision made by portfolio manager
2) Safekeeping of Portfolio Securities
3) Exchange privileges with Families of Funds
4) Ability to invest Fixed Sums in Full and Fractional Amounts
5) Ability to liquidate a portion of invest |
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Definition
| What are some of the more basic conveniences and services provided to investors of mutual funds? |
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Term
1) Growth Fund
2) Income Fund
3) Growth and Income Fund
4) Specialized Fund
5) Asset Allocation Funds
6) Tax-Exempt Funds
7) Hedge Funds |
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Definition
| When a mutual fund is defined by its investment objective, what are some of these classifications? |
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Term
1) Investment Objective
2) Investment Policies
3) Quality of Management
4) Risk Factors
5) Portfolio Turnover |
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Definition
| What are important factors to consider when comparing various mutual funds? |
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Term
1) Breakpoints uniformly apply to all recipients
2) Information concerning scheduled breakpoints is given to shareholders and prospective investors
3) The prospectus is revised if the schedules are revised
4) The investment company advises existing sha |
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Definition
| Most mutual funds have sales breakpoints, which are dollar levels at which the sales charges are discounted or reduced, and are clearly stated in the prospectus. What condition must be met for breakpoints to be allowed? |
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Term
| DCA plans are considers a way to reduce risk in mutual fund investing because share prices are combined and averaged out over time. |
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Definition
| What is dollar cost averaging in regard to mutual fund investing? |
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Term
1) Investment Objectives, Policies, and Restructions
2) Sales Loads and Fees include:
2a) Front End
2b) Contingent Deferred.
2c) 12b-1 Fee.
2d) Redemption Fee
2e) Management Fee
2f) Other Expenses
3) Expense Table
4) Breakpoint, Rights of Accumul |
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Definition
| What material information is required to be contained in a mutual fund's prospectus? |
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Term
1) Customer name and residence
2) Whether of legal age
1) Tax Idenfication or Social Security Number
2) Occupation of Customer and Name and Address of Employer
3) Whether Associated person of another NASD Member
4) Permission from the employing firm |
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Definition
| What important facts about a customer should a representative obtain when opening an account? |
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