WorksheetsInvestment Quiz
Total questions: 20
Worksheet time: 10mins
What does owning a stock represent?
A loan to a company
Ownership in a company
A government bond
A savings account
Which type of investment is generally considered the least risky?
Stocks
Bonds
Real estate
Mutual funds
What is a dividend?
A loan repayment from the government
The interest earned on a savings account
A portion of a company’s profits paid to shareholders
A tax on investments
What is the main advantage of a Junior ISA?
Tax-free growth on investments
Guaranteed high returns
Can be withdrawn anytime
Only available to retirees
What is one benefit of investing in mutual funds?
They are managed by professionals
They guarantee profit
They only invest in stocks
They are risk-free
If an 18-year-old wants to start investing with £1000, what is a key first step?
Invest all the money in one company’s stock
Research and diversify investments
Take out a loan to invest more
Spend the money on luxuries
Which of the following investment types is considered most liquid?
Real estate
Stocks
Bonds
Fixed-term savings accounts
What is an ETF?
A type of government bond
A fund that tracks an index and can be traded like stocks
A type of savings account
A cryptocurrency
Why is diversification important in investing?
It guarantees high returns
It helps reduce risk by spreading investments across different assets
It ensures all investments grow at the same rate
It is required by law
Which investment is most likely to provide passive income over time?
Stocks
Bonds
Real estate (rental properties)
A savings account
Investing is only for wealthy people.
True
False
Bonds generally offer higher returns than stocks.
True
False
ETFs provide diversification by investing in multiple assets.
True
False
You can withdraw money from a Junior ISA before the age of 18.
True
False
Real estate investments always increase in value.
True
False
What are two key risks associated with investing in stocks?
Market volatility and potential loss of capital
Guaranteed profit and stability
Low returns and tax penalties
No risk at all
Which UK investment platform can an 18-year-old use to start investing?
Nutmeg
Hargreaves Lansdown
Both A and B
Neither
What is the difference between capital gains and dividends?
Capital gains come from selling an investment at a profit, while dividends are company payouts
Capital gains are guaranteed, while dividends are random
Dividends are taxes, while capital gains are profits
There is no difference
Why is it important to set financial goals before investing?
To choose the right investments based on risk tolerance and time horizon
To guarantee profit
To avoid paying taxes
To make investing risk-free
What is one advantage of investing in bonds?
They provide a steady, predictable return with lower risk compared to stocks
They offer the highest possible returns
They are completely risk-free
They are the same as stocks
