BKM Ch$4$ problems $($Connect$/$Problem Sets$)10,13,18,27$

Open$-$end mutual funds find it necessary to keep a small fraction of total investments, typically around $5\%$

of the portfolio value, in very liquid money market assets. Closed$-$end funds do not maintain such a position in

"cash$-$equivalent" securities$.$ What difference between open$-$ and closed$-$end funds might account for their

differing liquidity policies?

The composition of the Fingroup Fund portfolio is: $200,000$ shares of stock A with a price of $$35,300,000$

shares of B with price $$40,400,000$ shares of C with price $$20,$ and $600,000$ shares of D with price $$25.$ The

fund has not borrowed any funds, but its management fee with the portfolio manager currently totals $$30,000.$

There are $4$ million fund shares outstanding. What is the net asset value of the fund?

Loaded$-$Up Fund charges a $12b-1$ fee of $1\%$ and maintains an expense ratio of $0\mathrm{.}75\%.$ Economy fund

charges a front$-$end load of $2\%,$ but has no $12b-1$ fee and an expense ratio of $0\mathrm{.}25\%.$ Assume the rate of return

on both funds' portfolios $($before any fees$)$ is $6\%$ per year. How much will an investment in each grow to after:

a$)1$ year?

b$)3$ years?

c$)10$ years?