Loan Services and Exchange Traded Funds Overview

Play an AI-generated podcast conversation about this lesson

What is the primary purpose of mutual funds?

Enable small investors to invest in a diversified portfolio (correct)

Administer financial risk for a fee

Offer retirement plans

Provide insurance protection

What do pension funds primarily invest in?

Money market funds

Life insurance

Bonds and stocks

Stocks, mortgages, and real estate (correct)

What do credit unions primarily focus on?

Administering financial risk for a fee

Providing life insurance

Offering retirement plans

Cooperative associations for members with a common bond (correct)

Which institution pools payments from individuals to invest in various securities?

Insurance companies Signup and view all the answers

What type of funds are designed for savers who prefer safety?

Bond funds Signup and view all the answers

Who administers retirement plans funded by corporations or government agencies?

Pension funds Signup and view all the answers

Which type of financial intermediary invests in equities that are not traded on the public capital markets?

Private equity firms Signup and view all the answers

Who are hedge funds open to, based on the information provided?

Individuals with a net worth exceeding $1 million Signup and view all the answers

Which type of fund is registered and regulated by the Securities and Exchange Commission (SEC)?

Mutual funds Signup and view all the answers

In which type of fund can an investor buy shares that hold stocks in a specific market?

Exchange traded funds (ETFs) Signup and view all the answers

Which financial intermediary loans members' savings to other members for purposes like auto purchases and home mortgages?

Credit unions Signup and view all the answers

What distinguishes hedge funds from mutual funds?

Hedge funds actively influence corporate managers Signup and view all the answers

What type of firm raises money from investors to provide initial financing for private start-up companies?

Venture capital firms Signup and view all the answers

Which type of firm acquires established companies to make them profitable again and then sell them?

Leveraged buyout firms Signup and view all the answers

What is a negotiable instrument that represents a financial claim and can take the form of ownership or a debt agreement?

Securities Signup and view all the answers

In which market do firms sell debt securities if the debt must be repaid in less than a year?

Short-term debt market (money market) Signup and view all the answers

Which type of company borrows money by selling debt securities in the debt market?

Investment companies Signup and view all the answers

Which type of firm is regulated to ensure the safety of the institution and protect investors, with the exception of hedge funds and private equity companies?

Hedge funds Signup and view all the answers