Mutual Funds Quiz

_________ is the process whereby small investors are able to purchase slices of assets that normally are sold only in large denominations.

• Monetary denomination

• Monitoring cost

• Transaction cost

• Denomination intermediation

Which one of the following statements is not correct?

• Mutual funds charge several fees and annual operating expenses

• Hedge funds are different from mutual funds

• Hedge fund pools small funds

• Mutual funds provide economies of scale to investment decisions

Mutual funds are regulated by _________

• Central banks

• Securities and exchange commission

• Insurance authority

• All of the above

Which one of the following is not a type of mutual fund?

• Hybrid funds

• Debt funds

• Equity funds

• None of the above

The value of one unit of investment in a mutual fund is called ______

• Issue value(IV)

• Net asset value (NAV)

• Gross asset value (GAV)

• Market value

________ is the type of fund that is not expected to a sudden and large movement of funds.

• Closed ended fund

• Fixed income fund

• Open ended fund

• Hybrid fund

_____ are considered a high risk funds, but also tend to provide high returns.

• Hybrid funds

• Money market funds

• Equity funds

• Debt funds

____ are funds that only invest in company debentures, government bonds and other fixed income assets.

• Hybrid funds

• Debt funds

• Equity funds

• None of the above

The net asset value (NAV) of a mutual fund is computed on _____ basis.

• Daily

• Weekly

• Monthly

• Yearly

Which one of the following statements is true about open-ended funds?

• Can buy shares from the fund, but must sell them in the open market.

• Shares cannot be redeemed

• Trades shares in the stock exchange

• Buy and sell shares from and to the fund