Share of the profits paid to stockholders

Penalties paid to stockholders for poor company performance

Monthly fees that stockholders pay to the company

Loans taken by the company from stockholders

What is the goal when trading stocks?

To sell before the market closes

What happens when a bond reaches its maturity date?

The principal is repaid to the bondholder

The bond's interest rate increases

The bond is converted into stock

The bondholder must purchase additional bonds

Market capitalization:

Is the total number of outstanding shares of a company's stock multiplied by the stock price

Is the difference between the 10-year high and 10-year low of a stock

Does not change once you buy a stock

Your return with a diversified portfolio will:

Rise and fall, but have less risk than a smaller number of stocks and a smaller number of sectors and asset classes

Fall if a single company in your portfolio goes out of business

Beat absolutely every other investor

What is diversification?

Spreading your money among different types of investments

Investing all your money in one type of investment

Keeping all your money in a savings account

Borrowing money to invest in the stock market

How does diversification help stabilize a portfolio?

By reducing the overall risk of the portfolio

By increasing the value of all investments simultaneously

By guaranteeing a positive return on all investments

By eliminating the possibility of any investment losses

Which best describes a bond?

A loan given to a company or government by an investor.

Something that holds stuff together

Owning a small piece of a company or corporation

What is the risk you are taking when investing in bonds?

The issuer of the bond (a.k.a. the company) might default not being able to pay you back

You will most likely not make positive returns

The principal of the loan may decrease over time

The rate of the loan is always variable so you never know what they may or may not pay you

How can you minimize the risk when investing in bonds? (Choose 2)

You can check the rating on the bond before you purchase it

Own government bonds because they tend to be considered almost risk-free which means you can expect to receive your interest and principal if you are investing in a single bond.

Always invest in a company that you like

Invest in bonds that people you trust recommend because they are never wrong

Why does the value of your bond decrease when interest rates increase?

When interest rates increase, companies issue bonds with higher interest rates so your existing bond (which has lower interest rates) will be worth less.

When interest rates increase, companies start looking to sell your bond to someone else because they want to pay less

When interest rates increase, companies start to put more money into their company so their stock price will increase

When interest rates increase, companies start to ask for more money because they want to start expanding their business

Which is NOT an example of an asset class?

Hard assets: Gold, real estate, etc.

Which investments would represent the most diverse portfolio?

Investing in 1 stock, 1 bond, and having some cash

Investing in 3 different company stocks

Investing in 2 stocks, and 1 bond

Keeping all your money in cash in case of an emergency

Assignment #2: Stocks and Bonds

Authored by Logan Stroud

Mathematics

12th Grade

CCSS covered

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35 questions

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MULTIPLE CHOICE QUESTION

5 mins • 1 pt

What is Bull market?

Buying a bull online

When everything goes up and people are buying.

When prices are going down and nobody is buying.

When people are selling false information.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

What is a Bear market?

When prices go up and everybody is buying.

Selling a bear online.

When prices go down and nobody is buying.

Buying bears online.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

What is the differences between stocks and bonds?

They are both investments.

A stock is what corn grows on, and a bond gets you out of jail.

Stock represents ownership, and bonds represents your word.

A stock represents ownership, and bonds represents a loan.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

Lower Risk but lower yield

stocks

bonds

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

Prices vary everyday.

stocks

bonds

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

Investors are guaranteed interest payments and a return of their money at maturity date.

stocks

bonds

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

1-4 letter symbol used to represent a company

Dow Jones

Tik Tock

Stock Sign

Ticker Symbol

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Assignment #2: Stocks and Bonds

What is Bull market?

What is a Bear market?

What is the differences between stocks and bonds?

Lower Risk but lower yield

Prices vary everyday.

Investors are guaranteed interest payments and a return of their money at maturity date.

1-4 letter symbol used to represent a company

What are dividends?

What is the goal when trading stocks?

What does an investor receive periodically from a bond investment?

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