Financial Industry Regulatory Authority (FINRA) Practice Exam 2026 - Free FINRA Practice Questions and Study Guide

The correct choice revolves around understanding the structure and nature of various investment companies. An open-end management investment company, which is often referred to as a mutual fund, primarily issues common stock. This includes shares that represent an ownership interest in the fund’s portfolio of investments. Investors purchase shares directly from the fund at the current net asset value (NAV), and the fund is obligated to buy back those shares when investors wish to redeem them.

In contrast, other types of investment companies listed in the choices often involve the issuance of other types of securities. An equity unit investment trust, for example, is designed to hold a fixed portfolio of stocks but may also issue some securities that differ from common stock. A closed-end management investment company may issue shares that trade on an exchange much like stocks but can also involve other classes of securities. A face-amount certificate company typically issues certificates representing a promise to pay a specified amount at a future date, which does not involve common stock.

Therefore, the unique characteristic of the open-end management investment company is its exclusive issuance of common stock, making it the only choice that fits the criteria of the question.