Funds Beginner: Introduction to Mutual Funds

Test your knowledge

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

0%
Keep studying!
Review your answers below to learn more.
1.
_______ are the earnings on a mutual fund's holdings that are distributed to shareholders.
Choose wisely. There is only one correct answer.
Dividends. Dividends are shareholders' shares of earnings.
2.
Which of the following is not a hybrid fund?
Choose wisely. There is only one correct answer.
A stock fund. Stock funds invest in a particular type of security (stocks), whereas hybrid funds are based on particular investment objectives.
3.
Stock mutual funds are oriented toward _______.
Choose wisely. There is only one correct answer.
Growth. Because stocks have growth potential, stock funds include them.
4.
A mutual fund is a(n) _______.
Choose wisely. There is only one correct answer.
Package of several types of securities. Although some mutual funds invest only in stocks or bonds, mutual funds as a whole are open to several types of securities.
5.
Which of the following is not a method of buying mutual fund shares?
Choose wisely. There is only one correct answer.
All of the above are valid methods. All the methods named are valid ways to buy mutual fund shares.
6.
Money market mutual funds invest in all but which of the following?
Choose wisely. There is only one correct answer.
Stocks. Money market funds invest in debts, and stocks are not debts.
7.
What are bonds sold by states called?
Choose wisely. There is only one correct answer.
Municipal bonds. This is the accepted name for them. The term "government bonds" refers to bonds sold by the federal government.
8.
Which of the following is not a type of mutual fund expense?
Choose wisely. There is only one correct answer.
Ownership fee. There are no fees just for owning mutual funds.