1. "A". SIPC rules cover brokerage accounts, not bank accounts.
  2. "D". Forwards are bespoke contracts in which both sides to the transaction face counterparty risk.
  3. "B". Though risk management and hedging are traits of hedge funds, they support the primary goal, which is to make money.
  4. "D".
  5. "C". Long term capital appreciation is the main objective in a real estate investment.
  6. "C". Companies issue warrants, not options.
  7. "D". Though they differ in many respects, REITs and DPPs allow for a relatively small upfront investment to gain real estate exposure.
  8. "B". All other positions are bearish.
  9. "C". Treasury notes are capital market investments, not money market.
  10. "B". GNMA income is taxed at all levels, SLMA ("Sallie Mae") channels student loan payments to investors and GNMAs are backed explicitly, not implicitly, by the full faith and credit of the United States government.
  11. "A". Futures contracts are standardized and trade on exchanges. They are liquid, whereas forwards are customized arrangements.
  12. "A". Certain tangible assets have the potential for massive capital gains due to their uniqueness and attractiveness to collectors. Gains are taxed at the investor's marginal tax rate, hardly an advantage; they are often partially or completely illiquid and accurate appraisal of their worth is difficult to obtain.
  13. "C". T-Bills have federal backing and may be found in a money market fund due to their short maturity.
  14. "D". Both trade and have contract terms as they are standardized. Options have terms less than a year, whereas LEAPSĀ® can extend out to thirty nine months.
  15. "D". By their scarcity, rare coins afford investors the opportunity for capital gains and an inflation hedge.
  16. "B". private equity is illiquid and often requires investors to commit to a long term investment. For this reason, investors typically have to be accredited.
  17. "C". Though nominally an equity security, preferred stock correlates more highly with fixed income in terms of its risk/return profile.
  18. "C". Though these structures can be complex, prepayment and extension risks are the primary considerations with CMOs as they are a mortgage backed security.
  19. "C". Stable Value funds and GICs are insurance company products that have been staple offerings in many retirement plans for years.
Introduction

Related Articles
  1. Financial Advisor

    The Hidden Cost of Hedge Funds

    Are hedge funds worth the hype and exclusivity they exude? Let us take a closer look at what is involved when investing with one.
  2. Managing Wealth

    Analyzing GE's Preferred Stock (GE)

    Learn why General Electric Company's new Series D Perpetual Preferred stock is an excellent choice for investors desiring a safe and steady income stream.
  3. Managing Wealth

    When Introducing Illiquidity to Your Portfolio Makes Sense

    Find out when you should consider adding illiquid investments to your portfolio, such as real estate or locked-up investment funds.
  4. Investing

    Hedge Funds Go Retail

    Find out how average investors are breaking into what was once reserved for the ultra rich.
  5. Investing

    Just How Different Are Hedge Fund Investing Strategies?

    Before investing in hedge funds, be sure to consider all the facts.
  6. Investing

    Key Reasons To Invest In Real Estate

    There has been a lot of negativity over the real estate sector since 2008. Here are the reasons why you should be investing in it.
  7. Investing

    Private Equity Real Estate Funds vs. REITs

    REITs and Private Equity Real Estate Funds are two different ways to invest in real estate.
  8. Investing

    Evaluating Hedge Fund Performance

    Most investors are aware of hedge funds, but many don't know the dirty details of this unique investment type.
  9. Financial Advisor

    DPPs: What Advisors and Investors Need to Know

    Direct participation programs, a new alternative investment class, are gaining steam. Here's what advisors and investors need to know.
  10. Financial Advisor

    Why You Should Be Buying Stocks, Not Going to Cash

    Hedge fund managers are buying up the shares of big companies. What do the managers know that we don't?
Frequently Asked Questions
  1. When are Beneficiaries of a Will Notified?

    Learn when the beneficiaries of a will must be notified, and understand how this requirement varies depending on whether ...
  2. Why Does Larry Page Pay Himself a $1 Salary?

    Google co-founder Larry Page continues to take an annual salary of only $1 as chief executive officer.
  3. What is Common Stock and Preferred Stock?

    Learn about the differences between common and preferred shares. Explore situations where preferred shares have more favorable ...
  4. Can CareCredit be Used for Family Members?

    Learn more about the available options that CareCredit offers to pay for out-of-pocket medical procedures with little to ...
Trading Center