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What is Asset Allocation?

• The process of paying annual interest on a bond

• Dividing an investment portfolio among different asset categories, such as stocks, bonds, and cash

• The profit from the sale of an asset

• An account that lets individual investors trade stocks

What defines a Bear Market?

• A market with increased stock trading and rising stock prices

• A market in which prices are falling, encouraging selling

• An account for trading stocks, bonds, and other investments

• A group of financial instruments with similar characteristics

What is a Bond?

• A market where stock prices are generally rising

• The annual interest payment on a bond

• A security in which the investor loans money to a company or government

• Profit from the sale of an asset

What is the purpose of a Brokerage Account?

• To calculate the profit from the sale of an asset

• To reinvest earned interest back into the principal

• To let individual investors trade stocks, bonds, mutual funds, and other investments

• To divide an investment portfolio among different asset categories

What characterizes a Bull Market?

• A market with falling prices that encourages selling

• A group of financial instruments behaving similarly in the marketplace

• A market in which there is increased stock trading and rising stock prices

• The annual interest payment on a bond

What is Capital Gain?

• Dividing an investment portfolio among different asset categories

• The annual interest payment on a bond

• Profit from the sale of an asset, such as a stock or a bond

• An account for trading stocks and bonds

What is Compound Interest?

• The process of paying annual interest on a bond

• The profit from the sale of an asset

• Reinvesting earned interest back into the principal to allow money to grow exponentially over time

• Dividing an investment portfolio among different asset categories

What is a Coupon in the context of bonds?

• The process of dividing an investment portfolio among different asset categories

• The profit from the sale of an asset

• An account that lets individual investors trade stocks

• The annual interest payment on a bond, usually expressed as a percentage of its face value

What is the practice of investing in a large variety of stocks, bonds, and/or funds to reduce overall risk called?

• Consolidation

• Diversification

• Allocation

• Aggregation

What is a dividend?

• A fee paid to brokers for executing a stock trade

• A tax imposed on financial transactions

• Money from the profits of a company that is paid out to its shareholders, typically on a quarterly basis

• An interest payment on a bond