11.5 Investment Strategies

A diversified portfolio is desirable because

• It limits investment choice

• It's a good predictor on rate of return

• It decreases risk

• It increases risk and return

Which of the following accurately describes asset allocation?

• Well-balanced portfolio of different stock classifications

• Dividing among different asset categories based on time

• Dividing among different asset categories based on risk

• Chance your investment won't be worth as much in the future

Stocks are insured against loss by most banks and credit unions.

• True

• False

What is Vanguard?

• a company that helps you invest in stocks for cheap

• a company that does your taxes

• a restaurant

It is free to buy stocks

• True
• False