Investment Quiz

Over a recent 20 year period, what percent of pros investing in large companies "beat the market?"

• 10%

• 20%

• 30%

• 40%

Review the section titled “Can You Pick Winning Stocks”. Why would it be risky to have your strategy be based only on picking individual stocks?

• Individual stocks are always profitable.

• Diversification reduces risk.

• Stocks never fluctuate in value.

• All stocks perform the same.

Which of the following Cognitive Biases can contribute to making bad investing decisions?

• Confirmation Bias

• Optimism Bias

• Anchoring Bias

• Recency Bias

Use the section titled “Risk Tolerance” to answer these questions: How can too little risk affect your investing experience?

• It can lead to higher returns.

• It can result in missed opportunities.

• It guarantees financial security.

• It always results in losses.

Use the section titled “Risk Tolerance” to answer these questions: How can too much risk affect your investing experience?

• It ensures consistent profits.

• It can lead to significant losses.

• It eliminates all risks.

• It guarantees high returns.

The final section is titled “Remember, Good Investing Is Boring.” What does this imply?

• Exciting investments are always better.

• Consistent, steady growth is key.

• Boring investments never succeed.

• High-risk strategies are preferable.

What is a brokerage account used for?

• To store money like a savings account

• To buy stocks, bonds, and other investments

• To earn interest on deposits

• To withdraw cash without fees

Which type of account allows you to invest money while having access to it when needed?

• Savings Account

• Checking Account

• Brokerage Account

• Retirement Account

Remi wants to make more investments in individual companies to increase his long-term earnings. Which type of account should he consider?

• Brokerage Account

• Retirement Account

• Savings Account

• Checking Account

Naomi wants to invest for retirement without worrying about paying taxes every year. Which type of account is suitable for her?

• Brokerage Account

• Retirement Account

• Savings Account

• Checking Account