Brusco Investing Quiz

A key difference between saving and investing is:

• Savings is for everyone, investing if for the wealthy

• Your money is insured when investing, it is not in savings

• Investing has a guaranteed return, savings does not

• Saving is emergencies & goals, investing is long-term wealth

Why is compound interest more beneficial than simple interest?

• Your money grows faster when it is compounded

• You earn interest on your interest

• Fees for compound interest are greater than simple interest

• Compound interest is hard to calculate, so fewer use it

Which would usually be considered the highest risk investment type?

• Individual Company Stock

• Mutual Fund

• Treasury Bond

• Money Market Account

The relationship between risk and return can be stated as:

• Higher risk indicates higher return

• Higher risk indicates lower return

• Lower risk indicates higher return

• No relationship exists between risk and return

Which is NOT a stock market index?

• New York Stock Exchange

• Dow Jones Industrial Average

• S&P 500

• Nasdaq 100

How can you make money on stocks?

• A. A capital gain

• B. Interest

• C. Dividends

• D. Holding the stock at least 3 years

If interest rates rise, what will typically happen to bond prices?

• Rise

• Fall

• Stay the same

• Bounce around

Andy earned $300 on a $1000 investment. What is his current ROI (return on investment)?

• 2%

• 3%

• 30%

• 40%

Which is true about Initial Public Offerings (IPOs)?

• IPOs occur when a private company becomes publicly traded

• All companies file an IPO

• The value of an IPO can be difficult to measure

• When IPO occurs, a company often raises money to grow the business

A diversified portfolio is desirable because

• It limits investment choices

• It's a good predictor on rate of return

• It increases risk and return

• It decreases overall risk.