Investment Company

An Investment Company

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Question

Which of the following describes an investment company?

Answers

A. provides complete investment advice to clients for a fee

B. tracks the market price performance of a sample of U.S. mutual funds

C. invests in a pool of funds belonging to many individuals in a portfolio of investments

D. all of these answers are correct

E. market value of all its assets divided by shares outstanding

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Explanations

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A. B. C. D. E.

For example, an investment company sells 20 million shares to individuals at $10 per share for a total of $200 million. The manager then invests this money in securities (according to fund objectives). Each investor owns a percentage of the investment company's total portfolio.

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