Series 6 Unit 3.9-3.12

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Across
  1. 1. An investment company may not issue securities to the public unless it has at least __________ thousand dollars in net assets
  2. 5. When using dollar cost averaging, if the market price of shares is down, _____ shares will be purchased
  3. 6. Back-end loads are known as ___________ deferred sales loads where the investor will not pay a chare until shares are redeemed
  4. 8. This type of fund is said to provide broad market exposure, low operating expenses, and low portfolio turnover.
  5. 11. If a fund charges a 12b-1 fee, a simple majority of the board must be made up of __________ persons
  6. 12. For front-end loaded shares, the price for investors is NAV plus ____________
  7. 15. ________ investment income is the source of an investment company’s dividend payments
  8. 16. When a shareholder passes away, his shares are assigned a cost basis _________ to the value of the shares on the date of death
  9. 18. NII = dividends + interest – ________ of the fund
  10. 20. Mutual funds with a back-end load are called ________ shares
  11. 21. This word is used to describe bond issued or guaranteed by U.S. federal government agencies and bonds issued by government-sponsored enterprises.
  12. 23. A ________ period is a period of time where, if shares are sold, an investor may lose the guarantee on the shares and could lose money if the share price has fallen since the initial investment
  13. 26. Principal-protected mutual funds have higher _________ compared to comparable mutual funds
  14. 28. This rate on an index annuity will limit the amount that’s credited to the accumulation account. For example, an index annuity with a 7% _____ will only allow 7% credit no matter how much the stock index has gained.
  15. 29. Whom assumes the risk in a fixed annuity?
  16. 34. Dividends and capital gains are distributed to investors in ________
  17. 37. This type of mutual fund is sold without a commission or sales charge. This absence of fees occurs because the shares are distributed directly by the investment company, instead of going through a secondary party.
  18. 38. Another name for global funds
  19. 39. A 1035 exchange is a ______ exchange between like contracts
  20. 40. An investment company must have a clearly defined _________ objective
  21. 41. An investor’s _______ in mutual fund shares is what was paid to buy the shares plus reinvested dividends and capital gains distributions
  22. 42. If the separate account performance is less than the AIR, the next month’s payment is ______ than the previous months payment
  23. 44. This type of fund invests in companies located anywhere in the world including the investor’s own country
  24. 46. An investor whom reinvests their dividends or capital gains to purchase additional share does not need to pay a _________
  25. 48. A policyowner who wants a refund within ________ days will receive all money paid
  26. 53. This type of fund contains a stock component for appreciation and a bond component for income.
  27. 54. An open-end management company is commonly known as a ____________
  28. 55. ___________ bond funds generally have a higher credit risk than government issues and can be classified as investment grade or non-investment grade
  29. 57. After a variable life policy has been in effect for two years, the surrender value of the policy is the _____ value
  30. 59. This is a significant risk of purchasing a fixed annuity where the fixed payment the annuitant receives loses buying power over time
  31. 60. Mutual funds that typically have a one-year, 1% CDSC, a .75% 12b-1 fee and a .25% shareholder fee are known as _________ shares
  32. 61. The purchase price of a fund share
  33. 62. This type of annuity s a type of insurance contract that promises to pay the buyer a specific, guaranteed interest rate on their contributions to the account.
  34. 63. In a variable annuity, payments are invested into the _______ account
  35. 64. For purposes of the sales charge, a life insurance contract is a maximum of _____ years
  36. 67. This type of fund invests in companies located anywhere in the world outside of its investors’ country of residence
  37. 69. Closed-end investment companies are also known as _______ traded funds
  38. 73. The _______ theory is a theory stating that an investment company that passes all capital gains, interest and dividends on to its shareholders shouldn't be taxed at the corporate level like most regular companies
  39. 75. The ______ guarantee is the insurance company’s guarantee that the annuitant will receive payments as long as he/she lives
  40. 77. An investor who purchases principal-protected mutual funds may not make new ___________
  41. 80. A beneficiary of an annuity is guaranteed either the greater of the total value of the annuity or the total amount _____ if the annuitant passes away
  42. 81. Triple taxation of investment income may be avoided if the mutual fund qualifies under __________ of the Internal Revenue Code.
  43. 82. This type of mutual fund stresses current income over appreciation
  44. 86. This type of annuity is purchased with a lump sum and the payout of the benefits usually commences within 60 days
  45. 87. Shares that are inherited are considered to have a ________ holding period and will be subject to more favorable tax rates
  46. 88. This type of annuity pays an interest rate based on the performance of a specified market index, such as the S&P 500.
  47. 89. The holding period of one year or less is considered __________
  48. 90. Investors that buy into a unit investment trust have a ________ right to income and capital gains generated by the funds’ investments
  49. 91. An _________ gain is a potential profit that exists on paper, resulting from an investment. It is an increase in the value of an asset that has yet to be sold for cash
Down
  1. 2. Another name for balanced funds
  2. 3. In a fixed annuity, payments are invested in the ______ account
  3. 4. This is the maximum sales charge allowed on a fixed-premium variable life contract over the life of the contract
  4. 7. If the separate account performance is greater than the AIR, the next month’s payment is _____ than the previous months payment
  5. 9. The investment strategy in which an investor divides up the total amount to be invested across periodic purchases of a target asset in an effort to reduce the impact of volatility on the overall purchase is known as ______________ averaging
  6. 10. These funds split the investments between stocks for growth, bonds for income and money market instruments or cash for stability
  7. 13. Loans are not considered _____ receipt of income and are received income tax free
  8. 14. There is no such thing as a _______ payment immediate annuity
  9. 17. ____________ is the process of converting an annuity investment into a series of periodic income payments
  10. 19. This type of fund seeks to invest in stocks that are deemed to be undervalued in price based on fundamental characteristics.
  11. 22. A hypothetical Illustration can show the maximum gross return (12%) but must provide a ______ percent return as well.
  12. 24. Indexed annuities often set limits on the potential gain at a certain percentage. This is known as the ___________ rate
  13. 25. The selling of a security at a loss for tax purposes and, within 30 days before or after, purchasing the same or a substantially identical security is known as __________
  14. 27. The _________ stage is the period during which an individual receives distributions from an annuity account
  15. 30. A _________ investment company is qualified to pass-through income under Regulation M of the IRS
  16. 31. An investor will owe capital gains taxes on the _________ if they sell shares after reinvesting
  17. 32. Another name for international funds
  18. 33. An annuity investor may pay a ____________ for early termination.
  19. 35. ______ months is the minimum amount of time allowed for an exchange privilege for a life insurance policy
  20. 36. This is the minimum percentage that must be made available for a loan after the policy has been in
  21. 43. Aggressive growth funds are also known as _________________
  22. 45. When buying or selling closed-end funds in the secondary market, an investor will pay a __________
  23. 47. Reinvested distributions purchase __________ shares
  24. 49. True or false: an investor will be taxed on a mutual fund’s unrealized profits
  25. 50. This term refers to a stream of payments guaranteed for some period of time
  26. 51. Mutual funds are required by the SEC to price fund transactions according to the day’s end net asset value. This is known as _______ pricing
  27. 52. Short-term capital gains are taxed at _______ income tax rates
  28. 56. These funds offer investors a guarantee of principal, adjusted for fund dividends and distributions, on a set future date while providing opportunities for higher returns through investments in higher risk and higher expected return asset classes such as equities
  29. 58. Mutual funds with a front-end load are known as _________ shares
  30. 65. Whom assumes the risk in a variable annuity?
  31. 66. This type of annuity include benefits, which include enhancement of a buyer’s premium but may come with longer surrender periods
  32. 68. This is a type of annuity where the value of which can vary based on the performance of an underlying portfolio of mutual funds.
  33. 70. Annuities are funded with _______ dollars
  34. 71. Dollar cost averaging results in a ______ cost per share than the average price per share.
  35. 72. Accumulation units _____ in value based on the separate account performance
  36. 74. There will be a cost basis ________ when dividends are reinvested
  37. 76. A voluntary _______ plan offers a mutual fund investor a way to accrue a large number of shares over time by investing a manageable fixed-dollar amount on a regular schedule, usually monthly
  38. 78. If an investment company does not have the minimum amount in net assets, it may still register a public offering with the SEC if it can meet the requirements within ______ days of the registration
  39. 79. True or false: the reinvestment of dividends is a taxable event to the investor
  40. 83. These funds are structured to grow assets in a way that is optimized for a specific time frame. The structuring of these funds addresses an investor's capital needs at some future date
  41. 84. This is a conservative projection of the performance of the separate account over the estimated life of the contract. It is provided to determine the value of an annuity contract and, therefore, the periodic income payment provided to the annuitant.
  42. 85. There is no stated ________ sales charges on variable annuities