Ask Question
BusinessBusiness
28 June, 11:22

A younger client with a moderate amount of funds is considering the purchase of a home in the near-term future. For this reason, the investor wishes to keep their assets as liquid as possible in the event that the right deal on a home comes along. As this client's registered representative, which of the following would carry the LEAST amount of liquidity and therefore be unsuitable for this client?

(A) Investment in bonds and bond funds focused on municipal securities

(B) Investment in equity securities such as preferred stock

(C) Investment in a DPP (Direct Participation Program)

(D) Investment in CDs (Certificates of Deposit) with varying short-term maturities

+5
Answers (2)
  1. 28 June, 11:29
    0
    c) Investment in a DPP (Direct Participation Program)

    Explanation:

    Direct Participation Programs are a form of limited partnership. DPP has the lack of liquidity, since ownership interests are not always freely transferrable and require the approval of a general partner of the DPP. Each of the other items listed are more liquid on a short-term basis. Bonds can be sold, bond fund shares can be redeemed, equities are easily sold in the secondary market, and though CDs are not transferrable, the maximum maturity is 1 year or less, so the client would have short-term access to the funds invested.
  2. 28 June, 12:16
    0
    C

    Explanation:

    Investment in a DPP (Direct Participation Program)

    A direct participation program (DPP) is a direct participation plan, they are non-traded pooled investments in real estate or also in energy business over an extended time frame.

    DPPs are not traded, that means that they lack the ability to be liquid and also not a reliable pricing mechanism. With DPPs there usally is a requirement for clients to meet up with asset and income thresholds to invest.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “A younger client with a moderate amount of funds is considering the purchase of a home in the near-term future. For this reason, the ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Dalton Industries makes all purchases on account, subject to the following payment pattern: Paid in the month of purchase: 25% Paid in the first month following purchase: 55% Paid in the second month following purchase: 20% If purchases for January,
Answers (1)
Identify the type of planning used to develop multiple-year plans based on a situational analysis, competitive assessments, and external factors of the organization.
Answers (1)
The Fed has decided to expand the money supply, leading to lower interest rates. As a partner in a tech start-up, you react to these lower interest rates by deciding to expand your operations and begin marketing your new artificial intelligence
Answers (1)
Bartran Company assembles ink cartridges. Each finished cartridge has three child items: a plastic case, a label and several ounces of ink.
Answers (1)
If you borrow money from a lending institution and agree to pay back the original amount plus the accrued interest, what does it signify? A. credit from the lending institution B. you are a creditor in the Lending institution's account C.
Answers (1)
New Questions in Business
In latvia, only one six-lane highway exists, connecting riga, its capital, with moscow. otherwise, the roads are two lanes and many are made of cobblestones or bricks.
Answers (1)
When the government injects money into the economy, consumers may have more disposable income, which may lead to higher unemployment. higher production lower production. increases in taxes.
Answers (2)
Stock prices are determined in the financial markets. Management's primary goal is to maximize the firm's stock price, so financial managers need to understand how these markets operate in order to make good decisions.?
Answers (1)
The World Trade Organization (WTO) has an important role in international trade. From the list below, select all statements about the WTO that are true. It is possible that more than one statement is true. 1.
Answers (1)
On October 1, 2019, Donna Equipment signed a one-year, 8% interest-bearing note payable for $50,000. Assuming that Donna Equipment maintains its books on a calendar year basis, how much interest expense should be reported in the 2020 income
Answers (1)
Home » Business » A younger client with a moderate amount of funds is considering the purchase of a home in the near-term future. For this reason, the investor wishes to keep their assets as liquid as possible in the event that the right deal on a home comes along.
Sign Up Forgot Password?