#1
Which of the following is NOT a type of mutual fund?
Index fund
Hedge fund
Savings fund
Bond fund
#2
What is the primary objective of a growth fund?
To provide regular income
To preserve capital
To maximize capital appreciation
To invest only in government securities
#3
Which type of mutual fund typically invests in a mix of stocks, bonds, and other securities?
Equity fund
Money market fund
Balanced fund
Sector fund
#4
In mutual fund terminology, what does 'load' refer to?
The maximum limit on investment amount
The commission or fee paid when buying or selling shares
The tax implications of fund distributions
The risk level associated with the fund
#5
What does 'asset allocation' refer to in mutual fund management?
The process of buying and selling securities frequently
The selection of specific securities to invest in
The distribution of fund investments across different asset classes
The performance evaluation of the fund
#6
What does 'benchmark index' mean in the context of mutual funds?
The highest performing fund in the category
A standard against which the fund's performance is compared
The minimum investment required for the fund
The fund's historical performance data
#7
What is the Net Asset Value (NAV) of a mutual fund?
The total value of all assets in the fund
The price per share of the mutual fund
The total expenses paid by the fund manager
The total number of investors in the fund
#8
Which investment strategy aims to buy and hold a diversified portfolio of securities for the long term?
Market timing
Value investing
Day trading
Buy and hold
#9
What does the expense ratio of a mutual fund represent?
The total amount of fees charged by the fund manager
The percentage of fund assets deducted annually for fund expenses
The net profit earned by the fund
The total number of shares outstanding in the fund
#10
What is an advantage of investing in an ETF (Exchange-Traded Fund) over a traditional mutual fund?
ETFs are actively managed
ETFs offer higher liquidity
ETFs have lower expense ratios
ETFs have higher minimum investment requirements
#11
Which investment strategy involves investing in securities that have performed poorly in the past, in anticipation of their future performance improvement?
Momentum investing
Contrarian investing
Growth investing
Income investing
#12
Which of the following is true about a closed-end mutual fund?
Shares are issued and redeemed based on investor demand
It trades on an exchange like a stock
It has a fixed number of shares that are not actively traded
It typically has lower expense ratios compared to open-end funds
#13
What does the Sharpe ratio measure?
Volatility-adjusted return
Market liquidity
Credit risk
Inflation rate
#14
What is the concept of 'alpha' in mutual fund performance evaluation?
The total return of the fund
The risk-adjusted return compared to a benchmark
The fund's expense ratio
The liquidity of the fund's assets