Funds Beginner: Introduction to Mutual Funds

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1.
When a mutual funds individual holdings make money, so do the mutual funds shareholders.
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True. Earnings are passed from the holdings to the funds shareholders.
2.
To identify the securities in which a mutual fund invests, you can read its _______.
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Prospectus. This is the only of the above choices that lists a money market fund's holdings.
3.
Which of the following is not a hybrid fund?
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A stock fund. Stock funds invest in a particular type of security (stocks), whereas hybrid funds are based on particular investment objectives.
4.
If a fee is charged on mutual fund shares that are sold, it is called a(n) _______.
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Back-end load. These fees are charged on shares that you redeem back to the fund.
5.
_______ are the earnings on a mutual fund's holdings that are distributed to shareholders.
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Dividends. Dividends are shareholders' shares of earnings.
6.
What are bonds sold by states called?
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Municipal bonds. This is the accepted name for them. The term "government bonds" refers to bonds sold by the federal government.
7.
Stock mutual funds mostly buy _______ stocks.
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Common. Common stocks provide the growth that stock funds seek.
8.
Which of the following is not a method of buying mutual fund shares?
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All of the above are valid methods. All the methods named are valid ways to buy mutual fund shares.