CSI
CSC2
Q1:
What is a leveraged ETF?
○
A
A fund that seeks to match the performance returns of the underlying index tracked○
B
An option designed to achieve multiple returns of inverse performance of the tracked underlying index○
C
A contract using borrowed funds to buy the underlying stock or portfolio○
D
A fund that uses an option strategy to reduce the volatility of the underlying portfolio
CSI
CSC2
Q2:
A shareholder receives rights from a company through direct ownership in shares. Not expecting to exercise them, she sells the rights on the relevant exchange. What is her capital gain?
○
A
The sale price less the exercise price of the rights.○
B
The current share price less the exercise price of the rights.○
C
The sale price of the rights.○
D
The current price of the shares less the sale price of the rights.
CSI
CSC2
Q3:
What are examples of primary investment objectives?
○
A
Growth and preservation of capital○
B
Tax minimization and safety of principal.○
C
Marketability and growth of capital.○
D
Marketability and tax minimization.
CSI
CSC2
Q4:
What is the main pitfall of closet indexing for investors?
○
A
The portfolio does not closely resemble the benchmark index.○
B
Investors must take greater risks due to a high portfolio beta.○
C
passively management fund can be marketed as actively managed.○
D
High portfolio turnover makes it unsuitable for taxable accounts
CSI
CSC2
Q5:
Which type of trader specializes in managing block trades on behalf of institution clients?
○
A
Responsible designated trader.○
B
Agency trader○
C
Liability trader○
D
Market maker