In: Finance
a.
Which of the following statement is correct?
None of the above |
||
Spread is not a trading cost for investors when trading common stocks |
||
Both open-end and close-end fund shares can be traded |
||
Closed-end fund share price is always the same as NAV |
||
Mutual funds can invest in money market instruments |
b.
Which of the following statement is NOT correct?
Municipal bonds is not a financial asset |
||
Common shares is a financial asset |
||
If the Efficient Markets Hypothesis is NOT true, investors should time the market |
||
Preferred shares is a financial asset |
||
None of the above |
c.
Which of the following statement is correct?
None of the above |
||
Price Impact is not a trading cost for investors when trading common stocks |
||
ETFs can be traded continuously throughout the trading day |
||
When buying on margin, if margin is greater than Initial Margin Requirement, a margin call will occur |
||
When buying on margin, if margin is greater than Maintenance Margin Requirement, a margin call will occur |
(A) Statement "Mutual funds can invest in money market instruments" is correct, because mutual funds that invest in money market instruments are those mutual fund that invests in high-quality, short-term debt instruments, cash, and cash equivalents
(B) Statement " Municipal bonds is not a financial asset" is not correct, because financial asset includes Cash, stocks, bonds, mutual funds, and bank deposits. Thus Bonds include Municipal Bonds
(C) Statement" ETFs can be traded continuously throughout the trading day" is correct