Investment VehiclesPregunta 41 de 110
A high-yield (junk) bond is best characterized by which of the following?
a.A below-investment-grade credit rating and higher default risk
b.A rating of AAA and minimal default risk
c.A tax-exempt status for all investors
d.A guarantee by the U.S. Treasury
Explicación
High-yield or junk bonds carry below-investment-grade ratings (below BBB- or Baa3) and compensate investors for greater default risk with higher yields. They are more sensitive to the issuer's financial health and economic conditions. They are neither government guaranteed nor uniformly tax-exempt.
Practica las 110 preguntas gratis — sin registro.
Preguntas relacionadas de este tema
- A unit investment trust (UIT) differs from a mutual fund primarily because a UIT:
- Which risk is most directly associated with owning a callable bond?
- A money market fund seeks to maintain which of the following characteristics?
- A futures contract obligates the parties to do which of the following?
- A Guaranteed Investment Contract (GIC) issued by an insurer is most similar in risk profile to which of the following?
- An investor buys a Treasury bill. How does a T-bill generate its return?
Última revisión: · proceso editorial
Equipo Editorial de PrepPass · Verificado con NASAA Series 65 Investment Adviser Law Exam · Cómo revisamos