Insurance-based and other managed products that sit outside standard mutual funds and ETFs.
Chapter 22 covers managed products that sit outside the standard mutual fund and ETF discussion. It includes segregated funds, labour-sponsored venture capital corporations, closed-end funds, income trusts, and listed private equity.
Students should read this chapter as a product-comparison chapter. Many of these vehicles attract investors because of a single feature such as a guarantee, a tax credit, or exchange trading, but the exam often tests the trade-offs that come with that feature.
Exam Focus
Distinguish guarantees, creditor protection, and insurance characteristics in segregated funds from ordinary fund structures.
Compare closed-end funds, listed private equity, income trusts, and labour-sponsored vehicles by liquidity, valuation, and tax treatment.
Recognize when a product’s headline benefit is offset by cost, concentration, volatility, or limited secondary-market support.
Labour-sponsored venture capital corporations as tax-incentivized venture-capital products with long holding periods, high risk, and limited suitability.
Closed-end funds as exchange-traded pooled investments with fixed capital, discount or premium pricing, leverage flexibility, and liquidity trade-offs.
Listed private equity as public-market access to private equity strategies, with valuation lag, discount risk, leverage, and manager-dependence considerations.