Exchange Traded Funds (ETFs) Quiz

What is a major reason why property investment is often preferred over equity investments?

It is more liquid
It requires less capital
It provides a higher rate of return
It is less volatile (correct)

What is the primary benefit of investing in REITs for individual investors?

To gain experience in property management
To earn rental income directly
To earn dividends from real estate investments without managing properties (correct)
To invest in physical properties at a lower cost

What is the typical advantage of REITs compared to physical real estate investments?

Higher potential for capital appreciation
Lower upfront capital requirements
Greater control over property management
Higher liquidity (correct)

Why might an investor choose to invest in unit trusts instead of individual properties?

To benefit from professional management (D) Signup and view all the answers

What is a key characteristic of REITs that sets them apart from other investment vehicles?

They generate a steady income stream with little capital appreciation (C) Signup and view all the answers

What is the primary goal of investing in property for long-term goals, such as retirement?

To benefit from intrinsic value appreciation over a long period (B) Signup and view all the answers

Why might an investor choose to invest in property instead of government bonds?

Because government bonds are not readily available to small investors (D) Signup and view all the answers

What is a key motivator for Asians to invest in physical assets, such as property?

Due to less development investment market (A) Signup and view all the answers

What is the primary purpose of an Initial Public Offering (IPO) in the stock market?

To allow companies to raise capital (D) Signup and view all the answers

Which of the following is an advantage of investing in stocks?

Stocks allow immediate buy/sell at any time (B) Signup and view all the answers

What is a characteristic of conventional Fixed Deposit (FD) accounts in Malaysia when withdrawn before maturity?

Rate payable is half the contracted rate (A) Signup and view all the answers

Which type of entity is NOT mentioned as being eligible to open a Fixed Deposit (FD) account in Malaysia?

Non-profit organizations (D) Signup and view all the answers

Which Islamic finance principle is used for Islamic Fixed Deposit (FD) accounts in Malaysia?

al-Mudharabah (A) Signup and view all the answers

Which of the following is NOT a recommended tip for investing in stocks?

Invest all your money into one single stock (C) Signup and view all the answers

Which of these is NOT a benefit of investing in stocks?

Guaranteed returns (C) Signup and view all the answers

What is the first step you should take to start investing in stocks?

Open a CDS and a trading account (D) Signup and view all the answers

Which of the following best describes how Exchange Traded Funds (ETFs) are priced and traded?

ETFs are priced and traded throughout the day like stocks. (C) Signup and view all the answers

What happens to bond prices when interest rates increase?

Bond prices fall since the fixed interest becomes less attractive. (C) Signup and view all the answers

What is one of the primary risks associated with bond investing?

Interest rate fluctuations impacting bond prices. (C) Signup and view all the answers

What is a common strategy investors use in real estate investment?

Investing in property to rent out, cover mortgage, and then sell or refinance for profit. (C) Signup and view all the answers

Which type of asset do ETFs NOT track?

Debt securities (B) Signup and view all the answers

Which characteristic is shared by both an open-end fund and a stock, reflecting the nature of ETFs?

ETFs fluctuate in value and can be traded throughout the day on an exchange. (A) Signup and view all the answers

Which of the following is NOT a common use of ETFs?

Issuing corporate bonds (A) Signup and view all the answers

In the context of bond investing, what does 'maturity date' refer to?

The date when the principal amount must be paid back in full. (B) Signup and view all the answers