Chapter 9 - Alternative Investments Flashcards
(22 cards)
Designed to perform in a manner that is inverse to the index it is tracking.
Inverse Exchange Traded Fund
Linked to the performance of a benchmark, but not principal protected.
Exchange Traded Note
Similar to an ETF, but its shares are forwarded (once per day).
Index Fund
Similar to an index fund, but it shares trade in the market and can be sold short.
Exchange Traded Fund
Performs in a direction that’s opposite its benchmark.
Inverse Exchange Traded Fund
An investment fund that uses exotic strategies involving derivatives, leverage, and selling short for wealthy, or accredited, investors.
Hedge Funds
REITs are not taxed on income if they distribute a minimum of ___%.
90%
REITs that invest in both mortgages and properties.
Hybrid REITs
General partners have a fiduciary responsibility towards a limited partner(s), what does that mean?
The general partner must protect the interest of the partner(s)
If a limited partner negotiates contracts, hire/fire employees, or lend name they could:
be subject to unlimited personal liability
A program with speculation on land appreciation and no positive cash flow or depreciation.
Raw Land
A program with risks of overbuilding, cost overruns, and long duration.
New Construction
A program with previous cash flow, but potential problematic tenant issues.
Existing
A program with beneficial tax credits, little chance of appreciation, and high maintenance costs.
Low Income
Government Assisted
An oil and gas program with high risk but potential high reward.
Exploratory
An oil and gas program where a company drills near an existing field.
Developmental
An oil and gas program with a combination of exploratory and developmental programs.
Balanced
An oil and gas program that purchases existing wells and creates immediate cash flows.
Income
Limited partnerships generally avoid registration by offering securities through:
private placements
The riskiest real estate program is:
raw land
Overbuilding is a risk in a _____ limited partnership
new construction
The riskiest oil and gas program is a(n) _____ program.
exploratory
