QS-035 Post Test

Teri decided to invest in a few different mutual funds rather than put all her investment dollars into one or two individual stocks. A stock in one of her mutual funds went bust, but since her money was spread out, Teri wasn't significantly affected. What advantage of mutual funds does Teri's situation illustrate?

Diversification

Which of the following is the best place to buy shares in a mutual fund:

Fidelity Investments

Which of the following is not an important variable of a bond fund:

The amount of time you spend researching the bonds in the fund

Kent wants to learn as much as possible about the mutual fund he's thinking of investing in. Which of the following is the best place he could go for detailed information:

The fund's prospectus

Mutual funds that contain both stocks and bonds are known as

balanced funds.

"Spiders" and "cubes" are types of

exchange-traded funds.

Commission fees associated with mutual funds are known as

loads

The price of a mutual fund's shares is determined by

net asset value.

A mutual fund that has no limit on the number of shares it can issue or the amount of money it can hold is called a(n)

open-end fund.

A fund that invests in stocks that tend to be undervalued or overlooked is called a

value fund.