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Mutual Funds FAQs

  1.

    Is it a good idea to buy mutual funds from banks?

  2. Is it possible to beat the market?

  3. Where do most fund managers get their market information?

  4. What do the different types of mutual fund classes mean?

  5. Is it possible to invest in an index?

  6. Do ETFs have a board of directors?

  7. What is a cross hedge?

  8. What advantages do exchange-traded funds have over mutual funds?

  9. What are the advantages and disadvantages of mutual funds?

  10. Where do I look for fees that I am charged on investments? What are those fees called?

  11. What is a long-short mutual fund?

  12. How much of a company's stock can a mutual fund own?

  13. What is "leverage" as it is used in closed-end funds?

  14. How do I find out how much money a mutual fund manager has in his or her fund?

  15. What was the first mutual fund?

  16. What is the difference between systemic risk and systematic risk?

  17. All of the following are regulated by the Investment Companies Act of 1940 EXCEPT

  18. Do speculators have a destabilizing effect on the financial system?

  19. What is an unregistered mutual fund?

  20. What is high-frequency trading?

  21. When did mutual funds come to the U.S.A.?

  22. Under the Investment Company Act of 1940, an investment company must have minimum net assets of how much before it can issue shares to the public?

  23. Under the Investment Company Act of 1940, an investment company, or mutual fund company, must have minimum net assets of how much before it can issue shares to the public?

  24. Can I still make money with a couch-potato portfolio?

  25. What is the performance cult?

  26. Compute the offering price for a mutual fund with NAV of $1,200,000,000, an 8% front-end load, and 1,000,000 shares outstanding.

  27. What is the difference between exchange-traded funds and mutual funds?

  28. How did Peter Young gain infamy as a "rogue trader"?

  29. How did currency trader John Rusnak hide $691 million in losses before being caught for bank fraud?

  30. What is market capitulation?

  31. What's the difference between a mutual fund and a hedge fund?

  32. When you buy a stock in a company, does it necessarily mean that one of the shareholders is selling it to you?

  33. Who's in charge of managing exchange-traded funds?

  34. Why do some closed-end mutual funds trade above or below their net asset values?

  35. What's the difference between a load and no-load mutual fund?

  36. What's the difference between absolute and relative return?

  37. What is a wrap account and what are the advantages of using one?

  38. What is the difference between a global fund and an international fund?

  39. What is the difference between a blend fund and a balanced fund?

  40. How do you find out the price of a mutual fund?

  41. What is mutual fund timing, and why is it so bad?

  42. What is late-day trading? Why is it any different from buying and selling stocks in the after-hours market?

  43. If I am American, can I buy a foreign mutual fund?

  44. What are soft dollars?

  45. Why can you short sell an ETF but not an index fund?

  46. What is a mutual fund's NAV?

  47. How can I buy an S&P 500 fund?

  48. What is a "socially responsible" mutual fund?

  49. Do hedge funds and mutual funds invest in commodities in high inflation environments?

  50. Which option is better on a mutual fund: a growth option or a dividend reinvestment option?

  51. Why would a person choose a mutual fund over an individual stock?

  52. What is the best way to save for private school expenses? A 529 plan, a Coverdell ESA or a mutual fund?

  53. Are ETFs required to pay out a percentage of income as dividends?

  54. What is the ideal number of stocks to have in a portfolio?

  55. I live in the U.S. How can I trade stocks in China and India?

  56. How is the value of the S&P 500 calculated?

  57. I want to invest in equities, but I don't have much money. Is there a minimum number of shares I must buy?

  58. What's the difference between institutional and non-institutional investors?

  59. What is the difference between municipal bonds and standard money market funds?

  60. Why is it that when investors realize returns on a mutual fund, its price tends to fall?

  61. Can a corporation deduct dividend payments to shareholders before taxes are calculated?

  62. Is it possible to lose all of your investment in an index fund?

  63. Are ETFs subject to the short sale uptick rule?

  64. How do you calculate the cost basis for a mutual fund over an extended time period?

  65. How do segregated funds differ from mutual funds?

  66. Why do all mutual fund tickers have an X at the end?

  67. Are mutual fund performance numbers reported net of fees (operating expenses and 12b-1)?

  68. Can I sell mutual fund shares below their minimum intial purchase amount without being penalized?

  69. What careers are popular among CFA charterholders?

  70. Can you place a stop-loss order on a mutual fund?

  71. How do I find mutual funds that track indexes?

  72. Is it possible to buy mutual funds using a margin account?

  73. Can an open-ended fund's price appreciate significantly?

  74. When my mutual fund declares an income distribution, the fund price falls by a similar amount. How does this distribution benefit me?

  75. What is a liquidity squeeze?

  76. What is securitization?

  77. I have a KSOP through my employer that I've invested 100% in company stock. I am now concerned that I'm not diversified and would like to move out of company stock and into mutual funds. Is this allowed with the funds I've contributed to the account?

  78. What are the oldest mutual funds, by date of inception?

  79. Can I match a fund to my religion?

  80. Who is Mr. Copper?

  81. How does pyramiding work?

  82. Which of the following statements regarding the performance of a mutual fund would be permitted under current rules?

  83. The risk an investor is most likely to encounter when investing in a Standard & Poor’s 500 Index fund is:

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Last Questions Asked:
  1.

    Is it a good idea to buy mutual funds from banks?

  2. Is it possible to beat the market?

  3. Where do most fund managers get their market information?

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