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
A is correct; private equity capital is typically illiquid for extended periods. B, C, and D are features of mutual funds, not private equity.
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