[Set 2] Module 2 - UITF Products Flashcards
(29 cards)
Unit Paying Funds will generally provide participating investors a GUARANTEED stream of additional income and also potential for capital appreciation.
False
Net Asset Value per Unit should be computed at least EVERY WEEK.
False
Net Asset Value per Unit should be published in a newspaper at least EVERY DAY.
False
ENCHMARK is a standard against which the performance of a mutual fund or investment manager can be measured.
True
A BALANCED FUND can have a Minimum: Maximum Equity Exposure [5% : 20%]
False
A UITFs participation is via purchase of SHARES while Mutual Funds is via purchase of UNITS.
False
The statements below are true for feeder funds, and fund of funds except:
a. The plan rules and related documents should say this
b. There should be an explanation and illustration of this structure
c. The target fund should not be a local collective investment scheme
d. All of the above
e. None of the above
c. The target fund should not be a local collective investment scheme
An accounting methodology which measures the value of tradable securities based on its current market price.
a. Accrual
b. Mark to Market
c. Lump Sum
d. Straight Method
b. Mark to Market
A local or foreign collective investment scheme in which the UITF invests all or a portion of its assets
a. Feeder Fund
b. Fund of Funds
c. Target Fund
d. None of the above
c. Target Fund
A multi-class fund can only have a maximum of 2 classes of units
False
The formula for computing a fund’s year to date return is:
a. Principal x rate x time
b.[NAVPU (current) – NAVPU (same period last year)]/ NAVPU (same period last year)
c. [NAVPU (current) – NAVPU (last year’s end figure)] / NAVPU (last year’s end figure)
d. None of the above
e. All of the above
c. [NAVPU (current) – NAVPU (last year’s end figure)] / NAVPU (last year’s end figure)
UITFs may invest in the following investment outlets except:
a. Bank deposits
b. Government securities
c. Exchange traded funds
d. None of the above
e. All of the above
d. None of the above
A client with little knowledge in investments asks for a brief description of UITF. The following statements describes UITF except for one.
a. UITFs are collective investment schemes
b. UITFs are made available by participation
c. UITFs are close-ended pooled trust fund
d. UITFs are regulated by the BSP
e. UITFs can be sold by bank branches.
c. UITFs are close-ended pooled trust fund
A Fund has NAVPUs of 100 on 12/31/2015 and 110 on 12/31/16. What is the YOY return of the fund on 12/31/16?
a. 5%
b. 10%
c. 15%
b. 10%
A client intends to invest in a fixed income security. He does not need the regular coupon payments. In what type of instrument should he be investing?
a. Treasury Bills
b. Fixed Rate Treasury Notes
c. Government Bonds
d. Time Deposits
e. None of the Above
a. Treasury Bills
You enjoy ownership rights with this type of equity securities.
a. Common Shares
b. Preferred Shares
a. Common Shares
A UITF can invest in derivatives to improve its yield.
False
A client wants to invest in a portfolio of equities and fixed income securities. Which type of fund should he invest in?
a. Fixed Income Fund
b. Balanced/Multi-Asset Fund
c. Equity Fund
d. Money Market Fund
b. Balanced/Multi-Asset Fund
A client is planning to invest in a UITF but is expecting Inflation to go up. He predicts that interest rates will go up. Do you think the client has the correct prediction?
True
Fund of funds is a UIT Fund structure that mandates the fund to invest at least 90% of its assets in ONE collective investment scheme.
False
UITF is INSURED by the Philippine Deposit Insurance Corporation (PDIC) up to Php 500,000.00
False
A UITF type that are invested in short-term, fixed income deposits and securities with duration of one year or less (≤ 1 Year) are called Money Market Fund
True
The minimum term for a Medium Term Bond Fund is 3 YEARS.
True
Information ratio tells an investor how much excess return is generated from the amount of excess risk taken relative to the benchmark.
True
