Which of the following statements regarding Exchange-Traded Funds (ETFs)is (are)false?
A)Most Exchange-Traded Funds are hedge funds.
B)Many Exchange-Traded Funds are organized as Unit Investment Trusts (UITs).
C)Many Exchange-Traded Funds invest in a variety of securities designed to mimic a particular market index.
D)All of the above statements are true.

Question

Quizplus · Accepted Answer

Most Exchange-Traded Funds are not hedge funds. In fact, most ETFs are structured as open-end investment companies or Unit Investment Trusts (UITs), which are different legal structures from hedge funds. Statement A is false. Most Exchange-Traded Funds are not hedge funds, but rather passive investment vehicles that track a specific index or sector.

Which of the Following Statements Regarding Exchange-Traded Funds (ETFs)is (Are)false