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SIE Exam Lesson 19 Mutual Funds pt 2 Quiz
SIE Exam Lesson 19 Mutual Funds pt 2 Quiz
This is a SIE Exam Lesson 19 Mutual Funds pt 2 Quiz, See how you do if you need help listen to the lesson over.
Questions covered include
1. Which of the following is true about closed-end funds?
(Select all that apply.)
A. It can trade at a premium or at discount to net asset value.
B. It is redeemed.
C. It has a fixed maturity and interest rate.
D. It trades as a common stock on the exchanges wherever it is listed.
2. Which of the following details can be found on the website of the company that sponsors a closed-end fund?
(Select all that apply.)
A. discount to net asset value
B. net asset value
C. premium
D. price of the stock
3. It is the amount annually collected from the shareholders, which include all the operating cost of the fund.
A. conversion ratio
B. expense ratio
C. liquidity ratio
D. Sharpe ratio
4. If a closed-end fund has a very high expense ratio, one reason you might wish to buy the fund is because ___.
A. it is sold at net asset value
B. it is sold at net asset value less than the expense ratio
C. it is sold at par value
D. it is sold at a big discount to net asset value
5. In financial industry, “Red Herring” refers to ___.
A. expense ratio
B. hedge funds
C. master limited partnerships
D. preliminary prospectus
6. Which of the following is true about a preliminary prospectus?
(Select all that apply.)
A. It contains the price of shares agreed upon.
B. It contains the total number of shares issued.
C. It does not contain the price of shares agreed upon.
D. It does not contain the total number of shares issued.
7. One way that funds will get a higher return than the market average or a bigger loss than the market average is by leveraging their assets.
A. True
B. False
8. A fund is leveraged at 9.2%. If it has $80,000,000 in its assets, the portfolio would reflect a value of ___.
A. $7,360,000
B. $72,640,000
C. $73,600,000
D. $87,360,000
9. Leveraged funds enhance returns and outperform the market when stocks are going down.
A. True
B. False
10. A mutual fund or a management company must distribute their income ___.
A. annually
B. monthly
C. quarterly
D. weekly
11. A management company distributes its income in a form of ___.
(Select all that apply.)
A. capital gains
B. commissions
C. dividends
D. interest
12. These are capital gains that the management company must distribute at least on an annual basis.
A. capital yield
B. distribution yield
C. dividend yield
D. income yield
13. Dividend yield is the dividend that is paid out from the stocks that the management company owns and then passed through to the investors.
A. True
B. False
14. If you buy a closed-end fund before or close to the record date, your net asset value would decline by the amount of the distribution.
A. True
B. False
15. What would be a good reason for management companies to organize as master limited partnerships?
A. They want to acquire big positions in closed-end funds.
B. They want to avoid the double taxation.
C. They want to decrease their management expenses.
D. They want to increase their management fees.
16. It is a tax document of a master limited partnership.
A. 1099-DIV
B. 1601F
C. CF-213
D. K-1
17. Why would a management company organize as a closed-end fund instead of an open-end fund?
A. Closed-end funds generally have higher sales commission than open-end funds.
B. In closed-end funds, managers may have to sell into a down market to raise money to pay for redemption.
C. In closed-end funds, managers will not be forced to redeem shares when the market is weak.
D. Unlike open-end funds, closed-end funds are more secure with specific maturity and interest rate.
18. A mutual fund held in another mutual fund would have double management fees.
A. True
B. False
19. The management fees of closed end funds ___.
(Select all that apply.)
A. are a way in which closed-end funds make money
B. are much more variable than the management fees of open-end funds
C. decline over time as assets decline
D. grow over time as assets grow
20. Why would hedge funds acquire a big position in closed-end funds?
(Select all that apply.)
A. so that they can avoid the double taxation
B. so that they can move and change the closed-end fund into an open-end fund
C. so that they can capture the discount of the fund
D. so that they can prevent the market movement
We hope you did well on this SIE Exam Lesson 19 Mutual Funds pt 2 Quiz
Total Course 37 hours 10 Min
37 hours 10 Min of audio instruction to help you prepare for the Securities Industry Essentials Exam
59 Audio Lessons for Securities Industry Essentials Exam
13 Bonus Lessons about the finance industry
Securities Industry Essentials Exam Podcast Audio Lessons for the SIE Exam
The full course details:
37 hours 10 Min of audio instruction to help you prepare for the Securities Industry Essentials Exam
59 Audio Lessons for Securities Industry Essentials Exam
13 Bonus Lessons about the finance industry
Securities Industry Essentials Exam Podcast Audio Lessons for the SIE Exam
New Series 7 Exam and SIE Exam details.
All candidates now must now pass both the SIE exam (securities industry essentials exam) as well as the New Top-Off Series 7 Exam. A Series 7 candidate must also have an industry sponsor in order to take the examination to take the SIE Exam the candidate simply needs to be 18 years old and no broker affiliation is needed..
https://www.finra.org/industry/essentials-exam
- “Securities Industry Essentials (SIE) Exam
Available Beginning October 1, 2018
The Securities Industry Essentials (SIE or Essentials) Exam, available beginning October 1, 2018, is a new FINRA exam for prospective securities industry professionals. This introductory-level exam assesses a candidate’s knowledge of basic securities industry information including concepts fundamental to working in the industry, such as types of products and their risks; the structure of the securities industry markets, regulatory agencies and their functions; and prohibited practices.
Key Features of the Essentials Exam
________________________________________
• The Essentials exam is open to anyone aged 18 or older, including students and prospective candidates interested in demonstrating basic industry knowledge to potential employers.
• Association with a firm is not required, and individuals are permitted to take the exam before or after associating with a firm.
• Essentials exam results are valid for four years.
The Essentials Exam at a Glance
________________________________________
Number of Items 75
Format Multiple Choice
Duration 105 minutes
Passing Score 70%
Cost $60”
New Series 7 Exam
The New Series 7 Content Outline provides a comprehensive guide to the range of topics covered on the exam, as well as the depth of knowledge required. The outline is comprised of the four main job functions of a general securities representative. The table below lists the allocation of exam questions for each main job function.
Major Job Functions Percentage of Test Questions Number of Test Questions
(F1) Seeks Business for the Broker-Dealer from Customers and Potential Customers 7% 9
(F2) Opens Accounts after Obtaining and Evaluating Customers’ Financial Profile and Investment Objectives 9% 11
(F3) Provides Customers with Information about Investments, Makes Suitable Recommendations, Transfers Assets and Maintains Appropriate Records 73% 91
(F4) Obtains and Verifies Customers’ Purchase and Sales Instructions and Agreements; Processes, Completes, and Confirms Transactions 11% 14
TOTAL 100% 125”
The five job functions of the new Series 7 General Securities Representative Exam will be:
“Seeks business for the broker-dealer through customers and potential customers”
“Evaluates customers’ financial status, financial needs and risk tolerance, and helps them identify their investment objectives”
“Opens accounts, transfers assets and maintains appropriate account records”
“Provides customers with information on investments and makes suitable recommendations”
“Obtains and verifies customer’s purchase and sales instructions, enters orders and follows up”
These five functions of the new series 7 exam are the same or substantially similar to ones on the current Series 7 exam. A notable change from the existing Series 7 exam is the addition of evaluating customer “risk tolerance.”
https://www.finra.org/industry/series7
Here is a link to the table of Contents
Here is what my customers say about my audio lessons
Testimonials
—————————
New Series 7 Exam and SIE Exam details.
FINRA has announced major changes to the Series 7 Exam effective October 1, 2018. With the introduction of the Securities Industries Essentials Exam (SIE Exam) the new series 7 has been pared down to 125 questions from its original 250 questions.
https://www.finra.org/industry/series7
However there is now a prerequisite before taking the new Series 7 Exam all candidates now must have passed the SIE exam (securities industry essentials exam). In addition thing a series 7 candidate must also have an industry sponsor in order to take the examination.
https://www.finra.org/industry/essentials-exam
“Securities Industry Essentials (SIE) Exam
Available Beginning October 1, 2018
The Securities Industry Essentials (SIE or Essentials) Exam, available beginning October 1, 2018, is a new FINRA exam for prospective securities industry professionals. This introductory-level exam assesses a candidate’s knowledge of basic securities industry information including concepts fundamental to working in the industry, such as types of products and their risks; the structure of the securities industry markets, regulatory agencies and their functions; and prohibited practices.
Key Features of the Essentials Exam
________________________________________
• The Essentials exam is open to anyone aged 18 or older, including students and prospective candidates interested in demonstrating basic industry knowledge to potential employers.
• Association with a firm is not required, and individuals are permitted to take the exam before or after associating with a firm.
• Essentials exam results are valid for four years.
The Essentials Exam at a Glance
________________________________________
Number of Items 75
Format Multiple Choice
Duration 105 minutes
Passing Score 70%
Cost $60”
Outline of SIE Exam:
https://www.finra.org/sites/default/files/SIE%20Outline-01.12.18.pdf
https://www.finra.org/industry/series7
https://www.finra.org/sites/default/files/Series_7_Content_Outline.pdf