Chapter 17 csc

A fund manager can negotiate trading fess better than an individual investor, which benefit of the managed product is the manager referring to :

• Economies of scale
• Low-cost diversification
• Tax benefit
• Low-cost investment option

Investors with a small sum of money have access to a large pile of stock, which benefit of the managed product is it referring to :

• Low-cost diversification
• Tax benefit
• Low-cost investment option
• Economies of scale

A product like LSVCC enjoy tax credits, which benefit of the managed product is it referring to :

• Tax benefit
• Low-cost investment option
• Economies of scale
• Low-cost diversification

Hedge funds don’t disclose their holding on a timely basis, which disadvantage of the managed product is it referring to :

• Lack of transparency
• Liquidity constraints
• High fees
• Volatility of returns

Hedge funds typically charge 20% performance fee in addition to the management fee, which disadvantage of the managed product is it referring to :

• Lack of transparency
• Liquidity constraints
• High fees
• Volatility of returns

Mutual funds are bought and sold at

• NAVPS
• Stock price
• The average price of investments
• black scholes based option price

“A fund manager is constantly monitoring the fund and is fine-tuning asset mix based on market condition “ this statement most likely relates to which advantage of mutual fund :

• Professional management
• Diversification
• Transferability of funds
• Redemption option

“You can get access to 60 to 100 stocks and invest in 15 to 20 industries “this statement most likely relates to which advantage of mutual fund :

• Diversification
• Transferability of funds
• Redemption option
• Professional management

“ You can switch between equity and debt funds within the same fund family without much cost“, this statement most likely relates to which advantage of mutual fund :

• Transferability of funds
• Diversification
• Redemption option
• Professional management

“Mr A is using his mutual fund holding to borrow money from the bank “this statement most likely relates to which advantage of mutual fund :

• Loan collateral
• Diversification
• Redemption option
• Professional management