12. How do investors in closed-end mutual funds receive capital gains distributi
ID: 2804921 • Letter: 1
Question
12. How do investors in closed-end mutual funds receive capital gains distributions? a) Paid directly to investors b) Reinvested in additional units c) As reductions in management fees and expenses d) Paid as distributions of units with no change to adjusted cost base 13. Which of the following is an advantage to investors of exchange-traded funds (ETFs) that is not available to investors in open-end mutual funds? a) ETFs allow investors to invest in broad U.S, market indexes as well as international indexes. Investors can avoid incurring an expense purchasing an ETF rather than investing in an open-end mutual fund. b) in the form of a bid-ask spread by c) ETF s offer a potential tax advantage to investors who incur capital gains taxes only when they sell ETF shares. ETF prices cannot deviate from net asset value. d) 14. All of the following are types of ETFs except: a. Inverse ETFs b. Leveraged ETFs c. Reverse ETFs d. Commodity-based ETFs 15. The two major disadvantages of Listed Private Equity are: a. Legitimate inside information and regulation b. Disclosure and transparency c. Lack of reinvestment options and discrepancies in trading values d. Illiquidity and management dependency a. Valued live, buy and sell costs, short selling and low MERs b. Valued live, use of leverage, buy and sell costs and short selling c. Buy and sell costs, short selling, low MERs and ease of trading d. Buy and sell costs, low portfolio turnover, ease of trading and valued live 16. Unlike index mutual funds, ETFs have all of the following characteristics:Explanation / Answer
12. Capital gains distribution is directly distributed to the investors. The distribution of capital gains is similar for both open ended and closed ended funds. The correct option is (A).
13. (C) The Mutual funds managers do keep on reshuffling the portfolio within the funds, so they create capital gains withing a mutual funds, But an ETF holder only creates capital gains if he or she sells it, else he is saved from creating the capital gains.
14. (d) Inverse, Reverse and Leveraged ETFs are the types of ETFs available, Commodity based etf is an etf where underlying is a commodity portfolio.
15. (A) & (B)The two limitations of Private Equity are: disclosures and information availability.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.