WIUTInvest 3.0

What is the primary goal of investment analysis?

• Ignore potential profitability and risk
• Evaluate potential profitability and risk
• Maximize losses and minimize gains
• Focus solely on short-term gains

In investment analysis, what is the key difference between ETFs and mutual funds?

• ETFs are bought and sold through the fund company, while mutual funds are traded on stock exchanges.
• ETFs and mutual funds have the same trading mechanism.
• ETFs and mutual funds have different investment objectives.
• ETFs are traded on stock exchanges, while mutual funds are bought and sold through the fund company.

What does fundamental analysis involve when evaluating stocks?

• Evaluating stocks based on financial statements, industry trends, management team, competitive advantage, and overall economic conditions.
• Evaluating stocks based on the company's brand popularity.
• Evaluating stocks based on rumors and speculation.
• Evaluating stocks based on technical indicators and price patterns.

Which component of the investment analysis process focuses on identifying and quantifying potential risks?

• Return Expectations

• Research

• Diversification

• Risk Assessment

Why is diversification important in investment analysis?

• To increase risk
• To maximize returns
• To limit potential gains
• To reduce risk

What is the primary difference between technical analysis and fundamental analysis?

• Technical analysis focuses on examining financial statements, while fundamental analysis focuses on historical price data.

• Technical analysis analyzes historical price and volume data to predict future price movements, while fundamental analysis examines the financial health of an asset or company.

• Technical analysis is primarily used for bonds, while fundamental analysis is used for stocks.

• Technical analysis is more reliable than fundamental analysis.

When does the pricing of mutual funds typically occur?

• At the beginning of each trading day.
• At the end of each trading day.
• Once a month.
• Whenever the market is volatile.

What is the key benefit of investing in exchange-traded funds (ETFs)?

• They offer higher returns than other investment vehicles.

• They provide daily liquidity.

• They offer intraday liquidity, allowing investors to buy or sell shares at market prices throughout the trading day.

• They are actively managed, ensuring better performance.

What is the primary goal of asset allocation in the investment analysis process?

• To maximize returns at all costs

• To determine the optimal mix of asset classes in a portfolio to align with an investor's risk tolerance and financial goals

• To buy as many stocks as possible

• To diversify across various asset classes with no regard for risk

When comparing mutual funds and ETFs, which one is typically priced at the end of each trading day?

• Mutual Funds
  

• ETFs

• Both mutual funds and ETFs

• Neither mutual funds nor ETFs