SIE practice questionhardPrivate Equity
A key difference between private equity funds and public mutual funds is that private equity funds:
- ACan be bought and sold freely on public exchanges
- BAre required to publish their net asset value daily
- CDo not offer daily liquidity and may require capital to be locked up for years✓ Correct answer
- DAre always registered under the Investment Company Act of 1940
Explanation
Why C — Do not offer daily liquidity and may require capital to be locked up for years
Private equity funds generally do not provide daily liquidity and may require investor capital to remain committed for years. Daily NAV publication and public exchange liquidity are mutual-fund or listed-product features.
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