Characteristics, Uses and Taxation of Investments - Sample Questions 1 - 7
- Joseph and Mary McCracken have the following bank accounts. In his own name, Joseph has $373,546.52; in her own name, Mary has $87,986.03 and jointly, they have an account with $987,901. Under current law, to what extent are they covered under SIPC rules?
- Joseph's account up to $100,000; Mary's entire account and the joint account up to $100,000.
- The entire joint account, up to the lesser of the account total or $100,000.
- Not more than $100,000 in the aggregate.
- With respect to futures and forwards
- Forwards are marked to market on a daily basis.
- Futures carry greater default risk than forward contracts.
- Futures trades are private transactions.
- A requirement of forwards is a high degree of creditworthiness on the part of both parties to the transaction.
- An investor in a hedge fund has as her primary objective
- Risk management.
- Long term capital appreciation.
- The ability to hedge.
- None of the above.
- The SEC was allowed to create SROs pursuant to
- The 1933 Act
- The 1934 Act
- The Maloney Act
- Real Estate investors seek the following objective
- Long-term growth
- Tax-deferred growth
- Both c. and d.
- Warrants and options share all of the following features, EXCEPT
- Tradable in the secondary market.
- Are subject to the volatility of the underlying.
- Are issued by the company upon whose underlying stock they are based.
- May serve as a less expensive means to gain exposure to an equity security than the actual purchase of that security.
- REITs and Direct Participation Programs in real estate are different in the following respects, except for
- Tax benefits.
- A less expensive manner in which to gain exposure to real estate than direct investment.
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