[Set 2] Module 3 - Regulations and Operations Flashcards
(32 cards)
A UITF’s historical NAVPU, Declaration of Trust and other account opening documents SHOULD BE MADE AVAILABLE in the TOAP or the trustee’s own website.
True
Trustee is NOT LIABLE for losses unless upon willful default, bad faith, or gross negligence
True
The UITF name SHOULD reflect the classification and underlying assets of the fund.
True
Government Securities are risk free and has no credit or market risk.
False
Is the summation of the market value of each investment less fees, taxes and other qualified expenses.
a. Net Asset Value (NAV)
b. Net Asset Value per Unit (NAVPU)
c. Benchmark
d. Market to Market (MTM)
a. Net Asset Value (NAV)
The Net Asset value of the UITF is calculated as follows:
a. Market value of each investment less fees, taxes and all selling expenses defined by the Board of Directors.
b. Market value of each investment less trust fees
c. Accrued value of each investment less fees, withholding taxes and any expenses
d. Market value of each investment less fees, taxes and qualified expenses defined in the Declaration of Trust.
e. Accrued value of each investment less fees, taxes and all necessary expenses.
d. Market value of each investment less fees, taxes and qualified expenses defined in the Declaration of Trust.
Which of the following documents a conservative-type of investor may sign if he wants to invest in aggressive types of UITF products/ equities?
a. Declaration of Trust
b. KIIDS
c. Waiver of CSA
d. Risk disclosure statement
e. Confirmation of Participation
c. Waiver of CSA
Which is not a type of UITF?
a. Feeder Funds
b. Fund of Funds
c. Multi Class Funds
d. All mentioned are types of UITF
d. All mentioned are types of UITF
Choose which statement does not describe a Risk Disclosure Statement.
a. One of the forms required in opening UITF account
b. This is the statement informing the client of the nature of the UITFs and the risks involved in investing therein.
c. As investments in UITF carry different degrees of risk, it is necessary that before client participate in these UITFs client should have: (1) Fully understood the nature of the investment in UITFs and the extent of exposure to risks, (2) Read this RDS completely, (3) Independently determined that the investment in the different UITFs is appropriate to client
d. RDS is optional when opening a UITF account
d. RDS is optional when opening a UITF account
Choose the procedures included in amending UITF plan rules.
a. Board Approval
b. BSP Approval
c. Notice Period to UITF investors of at least 30 days
d. All of the above
d. All of the above
Choose the mandatory declarations in UITF
a. UITF is not a deposit and not insured by PDIC
b. Returns cannot be guaranteed and historical NAVPU is for illustration of NAVPU movements and fluctuations
c. When redeeming, proceeds may be less than original investment and losses will be solely for the account of the client
d. The trustee is not liable for any loss unless upon willful default, bad faith, or gross negligence.
e. All of the above
e. All of the above
UITFs are exempt from the following statutory limits applicable to trust accounts in general.
a. Reserve requirements ratio
b. Single borrower’s limit (SBL) imposed on the bank
c. DOSRI ceilings
d. All of the above
d. All of the above
This is the statement where you can find the list of top investments and prospective investments, outlook and for strategy in the upcoming quarter. The enhanced measures of return, performance and volatility. This statement made available every calendar quarter?
a. Statement of Account
b. Risk Disclosure Statement
c. Key Information and Investment Disclosure Statement (KIIDS)
d. None of the above
c. Key Information and Investment Disclosure Statement (KIIDS)
What is the document signed by both client and the CUSP that helps to assess the risk profile of a UITF investor?
a. Client Suitability Assessment (CSA)
b. Risk Disclosure Statement (RDS)
c. Waiver of CSA Risk Profile (Waiver)
d. Participating Trust Agreement (PTA)
e. Confirmation of Participation (COP)
a. Client Suitability Assessment (CSA)
The total assets and accountabilities of each fund shall be accounted for as a single account method referred to as:
a. Accrual Basis Accounting
b. Cash Basis Accounting
c. Pooled Fund Accounting
d. Hybrid Accounting
e. Book Value Accounting
c. Pooled Fund Accounting
The following disclosures is incorrect:
a. The return of UITFs are guaranteed in the long run
b. UITFs are not covered by PDIC
c. Historical values, when presented, are for reference purposes only and are not in any form a guarantee of income/return
d. Gains/Losses are for the sole account of the client
e. All of the above
a. The return of UITFs are guaranteed in the long run
A Feeder Fund may only invest in a target fund regulated by the BSP
False
A fund’s performance is below its benchmark. This means that the fund is…
a. Outperforming
b. Underperforming
c. Cannot be determined
d. All of the above.
b. Underperforming
A client wants to invest in a fund that aims to beat a benchmark. In what type of fund should he invest in?
a. Actively Managed Fund
b. Passively Managed Fund
c. Fund-of-Funds
d. Feeder Funds
e. Multi-Class Funds
a. Actively Managed Fund
A UITF can best be described as:
a. Open-End Investment Company
b. Open-End Pooled Fund regulated by the BSP
c. Open-End Pooled Fund regulated by the SEC
d. Open-End investment vehicle issuing shares
b. Open-End Pooled Fund regulated by the BSP
If the client wants to follow the Philippine Stock Exchange Index, what should you offer?
a. Active Fund
b. Balance Fund
c. Passive Index Fund
d. Distribution Fund
c. Passive Index Fund
Tracker funds are a type of Passive Funds.
True
UITFS are exempt from statutory and liquidity reserves, single borrowers Limit (SBL) of the institution and Directors, Officers, Stockholders and their related interests (DOSRI) ceilings.
True
Investment in securities of UITFs shall be held for safekeeping by BSP ACCREDITED THIRD PARTY CUSTODIANS who shall perform independent MTM of such securities.
True
