CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

Which statement(s) about the exchange traded funds (ETFs) is(are) true?

I. ETFs combine features of closed-end and open-end mutual funds.
II. ETFs are typically actively managed stock or bond funds.
III. All investments are settled at the net asset value.
Correct Answer: I

I. They trade like closed-end funds. Similar to open-end funds, ETFs' prices track net asset value.
II. They are typically index funds.
III. The price is based on the market price and is not necessarily equal to the net asset value at the time.

User Contributed Comments 2

User Comment
Logaritmus II. There are also bunch of commodities ETFs
III. Example: ETF 100% Back with physical silver might have higher price/share than price of asset in case of shortage (2011 highs).
khalifa92 Note: the prices track NAV but it's not NAV.
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