Suitability Flashcards
1
Q
Preservation of capital/safety
A
- CDs
- money market mutual funds
- fixed annuities
- government securities and funds
- agency issues
- investment-grade corporate bond funds
- corporate bond funds
2
Q
Growth
A
- common stock
* common stock mutual funds
3
Q
Balanced/moderate growth
A
- blue-chip stocks
* defensive stocks
4
Q
Aggressive growth
A
- technology stocks
- sector funds
- micro-cap funds
5
Q
Income
A
- bonds (NOT ZERO-coupon bonds)
- REITs
- CMOs
6
Q
Tax-free income
A
- municipal bonds
- municipal bond funds
- roth IRAs
7
Q
High-yield income
A
- below-investment-grade corporate bonds
* corporate bond funds
8
Q
Income from stock portfolio
A
- preferred stock
- utility stocks
- blue-chip stocks
9
Q
Liquidity
A
- securities listed on an exchange
- nasdaq stocks or bonds
- mutual funds
- publicly-traded REITs
10
Q
Portfolio diversification
A
•mutual funds in general
-specifically asset allocation funds and balanced funds
•for equity portfolios, add some debt and vice versa
•for domestic portfolios, add some foreign securities
•for bond portfolios, diversify by region/rating
11
Q
Speculation
A
- option contracts
- DPPs
- high-yield bonds
- unlisted/non-nasdaq stocks or bonds
- sector funds
- precious metals
- commodities
- futures
