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Investing 101: Funds

Authored by Julie Hayes

Business

10th Grade

Used 23+ times

Investing 101: Funds
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42 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a mutual fund?

A type of investment that pools money from multiple investors to purchase a diversified portfolio of assets.

A type of investment that tracks the performance of a specific market index.

A type of investment that trades on an exchange like a stock.

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is an index fund?

A type of investment that pools money from multiple investors to purchase a diversified portfolio of assets.

A type of investment that tracks the performance of a specific market index.

A type of investment that trades on an exchange like a stock.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is an ETF?

A type of investment that pools money from multiple investors to purchase a diversified portfolio of assets.

A type of investment that tracks the performance of a specific market index.

A type of investment that trades on an exchange like a stock.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which investment vehicle is best suited for investors who want to achieve broad market exposure with low fees?

Mutual funds

 Index funds

ETFs

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which investment vehicle typically has the lowest expense ratio?

Mutual Funds

Index Funds

ETFs

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How are active investing and passive investing different? 

Active investing requires a hands-off approach while passive investing requires a hands-on approach

Active investing typically has lower fees while passive investing typically has higher fees

Active investing requires you to make a minimum number of trades per day while passive investing does not

Active investing is typically done by a fund manager trying to beat the market while passive investing typically involves investing in a popular index like the S&P 500

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A commonly used strategy to minimize investing risk is...

Investing only when a stock's value is rising

Investing in only one company

Hiring an investment manager who promises to provide the largest returns

Diversifying across asset classes and within each asset class

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