CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

Which of the following statements regarding investment companies is FALSE?
A. Investment companies invest exclusively in long-term instruments such as stocks, bonds and real estate.
B. Investors who purchase shares from an investment company become owners of the investment company.
C. Investment companies provide a means of acquiring international securities.
Explanation: Investment companies are also heavily involved with money market securities. Money market mutual funds are widely popular and consist of investments in short-term securities.

User Contributed Comments 2

User Comment
renataa B. does not sound right to me... Isnt the investment company an intermediary btw investor and the asset/purchased stock...?
sevywonder @renataa yeah, in a sense, but the fractional ownership aspect is critical to ICs' function
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