Exchange Traded Funds (ETFs) Quiz
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Questions and Answers

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?

    <p>To benefit from professional management</p> Signup and view all the answers

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

    <p>They generate a steady income stream with little capital appreciation</p> Signup and view all the answers

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

    <p>To benefit from intrinsic value appreciation over a long period</p> Signup and view all the answers

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

    <p>Because government bonds are not readily available to small investors</p> Signup and view all the answers

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

    <p>Due to less development investment market</p> Signup and view all the answers

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

    <p>To allow companies to raise capital</p> Signup and view all the answers

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

    <p>Stocks allow immediate buy/sell at any time</p> Signup and view all the answers

    What is a characteristic of conventional Fixed Deposit (FD) accounts in Malaysia when withdrawn before maturity?

    <p>Rate payable is half the contracted rate</p> 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?

    <p>Non-profit organizations</p> Signup and view all the answers

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

    <p>al-Mudharabah</p> Signup and view all the answers

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

    <p>Invest all your money into one single stock</p> Signup and view all the answers

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

    <p>Guaranteed returns</p> Signup and view all the answers

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

    <p>Open a CDS and a trading account</p> Signup and view all the answers

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

    <p>ETFs are priced and traded throughout the day like stocks.</p> Signup and view all the answers

    What happens to bond prices when interest rates increase?

    <p>Bond prices fall since the fixed interest becomes less attractive.</p> Signup and view all the answers

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

    <p>Interest rate fluctuations impacting bond prices.</p> Signup and view all the answers

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

    <p>Investing in property to rent out, cover mortgage, and then sell or refinance for profit.</p> Signup and view all the answers

    Which type of asset do ETFs NOT track?

    <p>Debt securities</p> Signup and view all the answers

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

    <p>ETFs fluctuate in value and can be traded throughout the day on an exchange.</p> Signup and view all the answers

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

    <p>Issuing corporate bonds</p> Signup and view all the answers

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

    <p>The date when the principal amount must be paid back in full.</p> Signup and view all the answers

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