SIE practice questionhardInvestment Company Act of 1940 - UITs
Which feature distinguishes a Unit Investment Trust (UIT) from mutual funds and closed-end funds?
- AUITs are actively managed
- BUITs issue shares that trade on exchanges
- CUITs are unmanaged after creation✓ Correct answer
- DUITs continually redeem shares from investors at NAV
Explanation
Why C — UITs are unmanaged after creation
UITs are fixed portfolios and are not managed once created. Mutual funds are actively managed and redeem shares; closed-end funds trade on exchanges. UITs are therefore unique in being unmanaged.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Spot an error in this question or explanation? Tell us — we fix these fast.
Related Investment Companies & Packaged Products questions
- A mutual fund is regulated primarily by which federal law?
- A registered representative recommends a speculative small-cap stock to a risk-averse retiree. Which principle is most…
- A registered representative must always consider which factor when recommending investments?
- A customer wants to invest in a professionally managed, diversified portfolio with no sales charges on purchases or…
- Closed-end funds differ from mutual funds in that closed-end funds:
- Which feature is unique to Unit Investment Trusts (UITs) compared to mutual funds and closed-end funds?
- Which feature is unique to unit investment trusts (UITs)?
- Which investment company type issues redeemable shares and has a fixed portfolio?