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NEW QUESTION: 1
Which of the following type/s of company/ies is/are defined by Investment company act?
A. Unit investment trust companies
B. All of these
C. Blue chip companies
D. Face amount certificate companies
Answer: A
NEW QUESTION: 2
A. Flexible Service Processor (FSP)
B. Integrated Management Module v1 (IMMv1)
C. Integrated Management Module v2 (IMMv2)
D. Integrated Virtualization Management (IVM)
Answer: A
NEW QUESTION: 3
An investment adviser suggests that his client, Arnold, a 74-year old gentleman, should consider a
reallocation of the assets in his portfolio. The adviser tells Arnold that he has far too much invested in
bonds, which don't earn as much as stocks. He advises Arnold to take 80% of the money he has in bonds
and invest it in an aggressive growth mutual fund that has provided an average annual return of 40% over
the past three years. Arnold is impressed and follows this advice. Shortly thereafter, there is a steep drop
in the market in general, and the net asset value of the aggressive growth mutual fund falls 85%. Does
Arnold have any remedies available to him?
A. No. Arnold had the choice and got greedy. As the old saying goes, "Bulls get rich, and bears get rich,
but pigs get led to slaughter."
B. No. The investment adviser had no way of knowing that the market was going to fall when he provided
the advice, so the adviser did not fail in his fiduciary responsibility to Arnold.
C. Yes. Arnold can sue for the amount of his losses, plus interest, as well as an amount assessed by the
court for "pain and suffering."
D. Yes. Arnold can sue for the amount of his losses, plus interest, court costs, and attorneys' fees.
Answer: D
Explanation:
If Arnold loses his money because he took the advice of his investment adviser and
reallocated a large percentage of his money from bonds to an aggressive growth mutual fund, he can sue
the investment adviser in civil court for the amount of his losses, plus interest, court costs, and attorneys'
fees. The courts do not award damages for "pain and suffering" in these cases. The investment adviser
failed in his fiduciary responsibility to Arnold in recommending that a 74-year old man reallocate a large
percentage of his money from the relative safety of bonds to the much riskier investment of an aggressive
growth mutual fund.
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