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WorksheetsU3L5 HW Finance
Total questions: 30
Worksheet time: 8hrs 30mins
What is a key difference between ETFs and mutual funds?
Mutual funds can be traded throughout the day like stocks.
ETFs can only be purchased at the end of each trading day.
Mutual funds can be traded intra-day like stocks.
ETFs can be traded throughout the day like stocks.
When was the first mutual fund launched?
1924
1993
2000
1980
Which type of fund is usually passively managed?
ETFs
Neither mutual funds nor ETFs
Mutual funds
Both mutual funds and ETFs
What is the minimum investment requirement for many mutual funds?
$500 to $5,000
$100
$10,000
$50
What is a characteristic of open-ended mutual funds?
They do not adjust their per-share price daily.
They are traded on the stock exchange.
They issue new shares as investor demand grows.
They have a fixed number of shares.
What is a benefit of ETFs over mutual funds?
ETFs have higher fees.
ETFs have a higher minimum investment.
ETFs can be sold short.
ETFs are less tax efficient.
What is the process of creating and redeeming ETF shares called?
Indexing
Creation and redemption
Market making
Stock splitting
Which type of ETF structure is preferred for investing in commodities?
Exchange-Traded Open-End Fund
Exchange-Traded Unit Investment Trust
Exchange-Traded Grantor Trust
Exchange-Traded Closed-End Fund
What is a common feature of mutual funds?
They may be less tax efficient.
Orders settle during market hours.
They can be traded between investors.
They have no minimum investment.
What is the expense ratio of Vanguard's S&P 500 ETF (VOO)?
0.06%
0.03%
0.04%
0.05%
What is an index fund?
A fund managed by Warren Buffett
A fund that tries to beat the market
A fund that matches the returns of a specific index
A fund that only invests in bonds
Which of the following is NOT a characteristic of index funds?
Tracks a specific market index
Low-cost investment options
Instant diversification
Actively managed by expert managers
What is the main goal of an actively managed fund?
Beat the market
Copy the index
Reduce risk
Match the market
Which type of index fund focuses on a specific industry?
U.S. stocks index fund
Global stocks index fund
Industry-specific index fund
Bond index fund
Why are index funds popular with investors?
They are actively managed
They have high fees
They offer diversification and low costs
They always perform better than the market
What is a major con of investing in index funds?
They always do about as well as the market
They have low fees
They offer instant diversification
They can never perform much better than the market
Which of the following is true about index funds?
They are only available as mutual funds
They can invest in a variety of assets like stocks, bonds, and real estate
They always beat the market
They are always actively managed
What did Warren Buffett bet $1 million on?
That gold would outperform real estate
That the S&P 500 would outperform the Dow
That a low-cost index fund would outperform an actively managed hedge fund
That an actively managed fund would outperform an index fund
Which of the following is NOT tracked by index funds?
Global stocks
U.S. stocks
Specific industries
Cryptocurrencies
What is a key takeaway about index funds?
They are managed by superstar stock pickers
They are high-cost investment options
They try to beat the market
They offer broad diversification and low costs
What is the typical annual fee range for a financial advisor who charges based on assets under management (AUM)?
3% to 4%
2% to 3%
1% to 2%
0.25% to 1%
What is the typical cost range for a flat annual fee charged by financial advisors?
$500 to $1,000
$1,000 to $2,000
$2,000 to $7,500
$7,500 to $10,000
How much do robo-advisors typically charge as an AUM fee?
0.10% to 0.20%
0.25% to 0.50%
0.50% to 0.75%
0.75% to 1%
What is the typical hourly fee range for financial advisors?
$100 to $200
$200 to $400
$400 to $600
$600 to $800
What is the cost range for a one-time financial plan fee?
$500 to $1,000
$1,000 to $3,000
$3,000 to $5,000
$5,000 to $7,000
Which type of financial advisor typically charges the lowest fees?
Robo-advisors
Commission-based advisors
Online financial planning services
Traditional human financial advisors
What is the median AUM fee among human advisors?
0.50%
1%
2%
1.50%
What is a common fee structure for financial advisors who charge based on assets under management?
Flat fee
Hourly rate
Commission
AUM fee
What is the typical cost range for a retainer fee charged by financial advisors?
$1,000 to $2,000
$2,000 to $7,500
$10,000 to $15,000
$7,500 to $10,000
Which type of financial advisor is recommended to avoid due to potential conflicts of interest?
Robo-advisor
Fee-only advisor
Fee-based advisor
Commission-only advisor
