WorksheetsInvesting 101 Worksheet
Total questions: 30
Worksheet time: 15mins
What is the Standard & Poor's 500 (S&P 500)?
It is a stock index that consists of the 500 largest companies in the U.S. and is generally considered the best indicator of how U.S. stocks are performing overall.
It is a government bond index that tracks the performance of U.S. Treasury bonds.
It is a measure of the inflation rate in the United States.
It is a currency exchange rate index for the U.S. dollar against other major currencies.
What is investing?
Investing is the act of putting money into a project or asset with the expectation of earning a profit or increasing the value of the investment over time.
Investing is spending money on luxury items without expecting any return.
Investing is the act of saving money in a bank account with no interest.
Investing is the process of donating money to charity.
What is a bull market?
A bull market is a period of time in financial markets when the price of an asset or security rises continuously (at least 20%).
A bull market is a period when the price of an asset or security falls continuously.
A bull market is a market condition where trading is halted.
A bull market is a period of time when the market is stagnant.
What is a bear market?
A bear market is a prolonged drop in investment prices (at least 20% from recent high).
A bear market is a period of rising stock prices.
A bear market is a market condition where prices are stable.
A bear market is a short-term fluctuation in stock prices
Which stock exchanges are mentioned in the context of trading?
New York Stock Exchange (NYSE) and NASDAQ
London Stock Exchange (LSE) and Tokyo Stock Exchange (TSE)
Shanghai Stock Exchange (SSE) and Hong Kong Stock Exchange (HKEX)
Euronext and Australian Securities Exchange (ASX)
A _______ is a range of investments held by a person or organization.
Portfolio
Account
Budget
Ledger
are the capital raised by a business or corporation through the issue and subscription of shares.
Stocks
Bonds
Loans
Debentures
A _______ is an investment program funded by shareholders that trades in diversified holdings and is professionally managed.
Mutual Fund
Savings Account
Certificate of Deposit
Bond
Fill in the blank: _______ is a type of investment fund that allows investors to buy a basket of assets like stocks or bonds, all in a single trade.
Electronic Funds Transfer (EFT)
Exchange-Traded Fund (ETF)
Mutual Fund
Hedge Fund
A _______ is a debt security that represents a loan from an investor to a borrower, such as a government, corporation, or municipality.
Bond
Stock
Equity
Mutual Fund
Fill in the blank: _______ is the degree of uncertainty and/or potential financial loss inherent in an investment decision.
Investment Risk
Investment Return
Investment Strategy
Investment Growth
What is the Rule of 72?
An easy way to calculate how long an investment will take to double in value by dividing 72 by the APR.
A rule to determine the interest rate needed to double an investment in 72 years.
A method to calculate the future value of an investment using 72 as a multiplier.
A guideline for diversifying investments across 72 different assets.
What is a Tax Shelter?
Ways individuals and corporations reduce their tax liability, ranging from employer-sponsored 401(k) programs.
A type of government tax incentive for renewable energy projects.
An illegal method of hiding income from tax authorities.
A financial institution that offers tax-free savings accounts.
What is a 401K?
A retirement savings plan that lets you invest a portion of each paycheck automatically before taxes are deducted depending on the type of contributions made.
A type of health insurance plan offered by employers.
A government bond that matures in 10 years.
A savings account for educational expenses.
What is a 529 Savings Plan?
A state-sponsored investment program that allows individuals to save money for educational expenses.
A type of retirement savings account.
A health savings account for medical expenses.
A government bond for infrastructure projects.
Investing helps in beating inflation by:
providing higher returns than the inflation rate
ensuring money is kept in a savings account
avoiding any financial risks
spending money quickly
What does saving involve?
Buying an asset
Setting money aside in safe, liquid accounts
Investing in stocks
What does investing involve?
Setting money aside
Buying an asset in hopes of earning a return
Keeping money in a checking account
Which accounts are included in saving?
Stocks and bonds
Checking and savings accounts, United States Treasury bills, and money market accounts
Real estate
What does investing include?
Checking accounts
Stocks, bonds, and real estate
Money market accounts
Investing can increase _______.
capital
expenses
liabilities
debt
What do investors purchase from a company to become part-owners?
Stocks
Bonds
Real Estate
Commodities
How can stockholders earn money?
By trading stocks
By earning dividends from the company's profits
Both A and B
What is the role of stock exchanges in the stock market?
Stock exchanges facilitate the buying and selling of stocks between buyers and sellers.
Stock exchanges set the prices of stocks.
Stock exchanges provide loans to investors.
Stock exchanges insure stocks against losses.
What is the perspective of a Bull Market?
Pessimistic
Optimistic
Neutral
Uncertain
In a Bear Market, what is the trend?
Grow or Expand
Decline or Shrink
Remain Stable
Fluctuate
Which of the following is a defining factor of a Bear Market?
Increase in stock market value
Increase in jobs
Decrease in GDP
Increase in inflation rate
What is a way for companies to raise capital without having to issue shares or seek other forms of financing?
Corporate bonds
Bank loans
Venture capital
Crowdfunding
Which type of bond has a higher risk of defaulting on its loan payments due to high levels of debt or variable revenues and earnings?
High Yield (Junk) Corporate bonds
Government bonds
Municipal bonds
Investment-grade corporate bonds
What is the safest type of bond to invest in because they are issued by large, stable, national entities?
Government bonds
Corporate bonds
Municipal bonds
Junk bonds
