Unit 3 Flashcards
What percentage of board of directors must not be affiliated persons
40%
Who safeguards the securities held in a mutual fund’s portfolio?
Custodian
Which funds generally come with a check-writing privilege
Money Markey Funds
How are gains from changing mutual funds taxed
Long-term capital gain
What open-end investment companies are also referred to as
Mutual funds
ARe REITS or DPPs flow-through vehicles?
DPP’s
What REIT’s pass through
Taxable income from operations
When 12b-1 fees are subject to approval by a vote of the board of directors of the company
Annually
3 types of investment company
- face-amount certificate companies
- management investment companies
- unit investment trusts
What mutual fund pricing is based on
The next calculated NAV per share after the order is received (The next day)
How long initial contract between investment company and investment adviser must be for
2 years, and renewed every year after
SEC and FINRA rules do permit sales charge discounts for who
- Individual purchasers making large purchases
- Tax-exempt organizations (e.g., pension plans, employee benefit plans)
- Directors, officers, employees, underwriters, and other persons affiliated with the fund
Three person who approve of person managing mutual fund portfolio
- The shareholders
- The fund’s board of directors
- That portion of the fund’s board consisting of noninterested members.
How NAV is computed
Subtracting all liabilities from assets
What investment company act of 1940 did
Defined what an investment company is
