Johan and Susan discussed investments into mutual funds. Johan claims that shares of open-end fund can trade at prices that deviate from NAV. Susan states that shares of closed-end fund can sell only at NAV. Both Johan and Susan are incorrect Both Johan and Susan are correct Johan is correct and Susan is incorrect Johan is incorrect and Susan is correct

Johan and Susan discussed investments into mutual funds. Johan claims that shares of open-end fund can trade at prices that deviate from NAV. Susan states that shares of closed-end fund can sell only at NAV. Both Johan and Susan are incorrect Both Johan and Susan are correct Johan is correct and Susan is incorrect Johan is incorrect and Susan is correct

PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)

6th Edition

ISBN:9781337117005

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter13: Investing In Mutual Funds, Etfs, And Real Estate

Section: Chapter Questions

Problem 1FPE

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Similar questions

Which of the following is FALSE about the differences between ETFs and Mutual Funds? Select one or more: a. ETFs were introduced before Mutual Funds b. Both ETFs and Mutual Funds can be traded just like stocks c. The Mutual Fund Industry is much larger than the ETF industry d. Mutual Funds fees are typically higher than ETF fees.
Master trusts allow investors to Select one: O a. Switch between Funds and/or managers without selling the underlying investments in the trust O b. Buy or sell direct Australian shares. c. Access a range of fund managers. d. All answers are correct. е. Two of the specific statements are correct.
Your friend suggests that a good way to study whether stock prices are in- formationally efficient is to analyze whether mutual fund managers can earn abnormal returns. Should her study examine the performance of fund managers gross of expenses or net of expenses (i.e., the fund return minus expenses)?
Sam and Kelly are having a disagreement. Sam says that stocks that do not pay dividends are best and Kelly believes that stocks with high dividend payouts are best. Explain why they are both correct.
You have some funds that you would like to invest and you are relying heavily on the EPS calculation to help you make your decision. Initially you are baffled about why preferred dividends are subtracted in the numerator and why a weighted average is used in the denominator, so you do some research and reflection and come to understand why. Your friend is interested in hearing about your thought process. How would you explain to your friend why its important to subtract preferred dividends and to use weighted averages?
Explain two major reason why an investor would use a managed fund instead of investing the money in shares on his or her own. Explain why/how these are expected to benefit the investor.
What type of mutual funds would not be good for long-term investors? Can you find a specific one and explain why it would be a mistake for a long-term investor to buy it?
Yinzhou is an investment adviser of CBMC Fresno Inc., and one of his client intends to invest in a stock that plots below the security market line (SML). What would be the appropriate recommendation? O Invest; The expected return is high relative to the risk. O Don't invest; The risk is high relative to the expected return. O Invest; All stocks revert to the SML over time. O Don't invest; All stocks below the SML are low-growth stocks.
Q5: How do Unit Trust Funds differ from Mutual Funds? Q6: When you are buying a unit trust fund, what are types of fees you will normally incur?
Which of the following is an example of direct finance? Select one:investors buy shares in a mutual fundA pension fund manager buys a security in the secondary marketinvestors buy shares in a mutual fundNone of the answers are correctcompany buy security in a secondary market
Evidence indicated that stock traders and mutual fund managers have success based on the formula: success = talent + luck. are being rewarded more for luck than skill. Succeed when they use outside views instead of inside views. O have suboptimal outcomes because of the endowment effect. S ●ENGARAN
With respect to hedge fund investing, the net return to an investor in a fund of funds would be lower than that earned from an individual hedge fund because of:a. Both the extra layer of fees and the higher liquidity offered.b. No reason; funds of funds earn returns that are equal to those of individual hedge funds.c. The extra layer of fees only.