- Exchange-traded funds (ETFs) are an example of: A. mutual funds. B. no load funds. C. open-end funds. D. closed-end funds. The answer was C. My question is why not B?
My best guess would be because of the commission to buy the ETF, is considered a “load”…
juventurd Wrote: ------------------------------------------------------- > 114. Exchange-traded funds (ETFs) are an example > of: > A. mutual funds. > B. no load funds. > C. open-end funds. > D. closed-end funds. > > The answer was C. My question is why not B? good one – no load ???
juventurd Wrote: ------------------------------------------------------- > 114. Exchange-traded funds (ETFs) are an example > of: > A. mutual funds. > B. no load funds. > C. open-end funds. > D. closed-end funds. > > The answer was C. My question is why not B? It is either B or C – anyone ? I say B
C
ETF has a fixed number of shares and investors buy and sell like stocks, so how is that similar to an open end fund? Also, no NAV, but dynamic price…!
*** oops! wrong thread **** post deleted
Answer should be D. ETF’s are similar to a closed end mutual fund because they trade durring the trading day and the price can move away from the NAV. Open end mutual funds only trade once a day and are ALWAYS bought and sold at their NAV. They are also not like a no load fund because you still have to pay a commission to purchase and sell them, unlike a no load open ended mutual fund. Don’t see how the answer could be C…
Clearly C. It is a characteristic of EFT.
strangedays Wrote: ------------------------------------------------------- > Clearly C. It is a characteristic of EFT. two of the smartest guys on the board disagree – I am siding with an ETF being like a closed end fund, now
I’m with rlange on this…I don’t see how it could be C, or even A or B!
I say D
According to Wikipedia, it’s D. I swear I read it in the text somewhere but I can’t find it.
a mutual fund, no-load and open-end are structured so that they price all at the end of the day. closed-ends trade on the exchange, they are like ETF’s
I’d say ETFs are subset of close ended funds.
i say tomato you say tomAto
its not a closed end because of the “in kind transfer” mechanism. This creates/destroys shares sot that they do actually trade very near to NAV. check out the section of ETF’s its a goodie - That means you Jay S.
no it’s not a closed end fun you are correct, an ETF is exactly what you described, they asked what it’s most like.
strangedays Wrote: ------------------------------------------------------- > http://www.sec.gov/answers/etf.htm : )