Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!

Get a certificate for this quiz
Enter your name and email address below to receive certificate for this course. You will need this to confirm you have completed it.


Review your answers below to learn more.
1.
If you are an active, frequent trader of exchange-traded funds, then your trading expenses will probably _______ those of mutual funds.
Choose wisely. There is only one correct answer.
Exceed. Those who trade frequently will probably discover this. So if you plan to trade ETFs frequently, you should take note.
2.
Exchange-traded funds are a type of mutual fund.
Choose wisely. There is only one correct answer.
False. Exchange-traded funds are not mutual funds; they are baskets of securities that are traded on an exchange. They are actually part mutual fund, part stock.
3.
In what form do investors buy or redeem shares from an exchange-traded fund?
Choose wisely. There is only one correct answer.
In blocks of a certain number. The blocks are typically in groups of 50,000 shares.
4.
When can you buy exchange-traded funds?
Choose wisely. There is only one correct answer.
Anytime during the trading day. As opposed to mutual funds, which are sold at the end of the day no matter when during the day you place your order, you can buy exchange-traded funds at any time during the day.
5.
In general, exchange-traded funds are cheaper to buy than index mutual funds if you want to trade regularly.
Choose wisely. There is only one correct answer.
False. Because of their commissions, regular trading will likely cost you more with exchange-traded funds.