56. For an investor in a standard exchange-traded fund, what is the single risk to the performance...
Question:
56. For an investor in a "standard" exchange-traded fund, what is the single risk to the performance of the fund?
| Short-selling bans | ||
| Front-running | ||
| Roll-yield loss | ||
| Market risk |
57. From lowest to highest degree of risk and volatility, how would you rank each of the following components of a split-share offering?
| Split preferred shares - the underlying basket of stocks - Split capital shares | ||
| Underlying baskets of stocks - split preferred shares - split capital shares | ||
| Split preferred shares - split capital shares - the underlying basket of stocks | ||
| Underlying basket of stocks - split capital shares - split preferred shares |
58. A hedge fund has a hurdle rate of 4% and achieved an 18% annual rate of return. What percentage is the fund manager's incentive fee calculation based on?
| 22% | ||
| 18% | ||
| 14% | ||
| 4% |
59. Within the fixed-income category, both "distressed" and 'high-yield" bonds are considered high risk investments. What is it about "distressed" bonds that is different from "high-yield bonds?
| They are bonds that are issued by companies that are currently in, or near, bankruptcy | ||
| They must have currently suspended all coupon payments | ||
| They are used as part of a hedging strategy | ||
| They are eligible for purchase by institutional investors |
60. Beyonce has received several distributions from an exchange-traded fund (ETF) she owns but is confused about the tax issues related to these distributions she has received. Which type of ETF distribution is not subject to tax?
| Capital gains | ||
| Dividends | ||
| Interest | ||
| Return on invested capital |
Expert Answer:
The detailed answer for the above question is provided below 56 Market risk While factors like shortselling bans frontrunning and rollyield loss can i... View the full answer
