Investment Vehicles Flashcards
Dividend discount pricing model =
Dividend / (Required Rate of Return - Growth Rate)
Preferred dividends are typically paid ______
semi-annually
Corporate holders of preferred can exclude _____ of income received from tax
70% (if they own more than 20% of the issue they can exclude 80%)
Theoretical price of preferred stock =
annual income / market yield
Preferred prices will _____ when interest rates _____
fall when interest rates rise
Preferred stock has no _____ or ______ rights
voting or preemptive
Participating preferred is also known as ______
performance preferred
Do ADRs have voting or preemptive rights?
NO
Non-sponsored ADRs trade ____
OTC
“Intestate” means that a person had no ____
will
Preferred dividends can ONLY be paid in ________
cash
The Federal Farm Credit System issues bonds for all of the farmers’ agencies - these are _____, _____, and ______
Federal Intermediate Credit Banks, the Federal Land Banks, and the Banks for Cooperatives.
Federal Farm Credit issues are exempt from _______
state and local taxes on interest income
Federal Farm Credit issues are backed by ______
the full faith and credit of the Federal Farm Credit System Banks
The Federal Intermediate Credit Bank is an “intermediary” providing ______ to farmers.
short term loans
Brady bonds are issued by _____ and denominated in ______
issued by foreign gov’ts and denominated in US dollars
Sales charges apply to ______ funds
open end funds (commissions apply to close end funds)
In order for a fund to be regulated under Sub chapter M, they must distribute at least ______ of income to shareholders
90%
Premiums for term life, whole life, and universal life are deposited into the _______
general account
The death benefit for term life, whole life, and universal life is fixed based upon _________ and is not subject to ________
is fixed based on premiums deposited and is not subject to reinvestment risk
Flexible premium variable is another name for _______
variable universal life
Flexible premium variable and variable universal allow the policyholder to ______ a premium payment
skip
A fund that distributes at least 90% of its income is considered _______
regulated (not “tax exempt”)
Treasury bonds mature at _____ with no _____
mature at par with no accrued interest (don’t mature at par plus accrued interest)
When a gov’t dealer enters into a repo with the public, the public is ______ and the dealer is _____
the public is lending monies and the dealer is the seller of securities (provides the dealer with liquidity)
