Investing Review

Front

A key difference between saving and investing is

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

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Why is it important to start investing as soon as possible?

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You have more time for your money to compound

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The possibility of losing all or part of your investment is known as

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risk

Front

Generally, how is risk related to return?

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the greater the risk, the greater the possibility of a high return

Front

A single share of ownership of a company is called a:

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Stock

Front

Stocks are low risk investments options.

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False

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Leaving your investments in the stock market alone for at least five years is a good way to reduce risk because…

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It keeps you from reacting to dips in the market and selling at too low of a price

Front

This is a type of investment where investors pool their money together to buy stocks, bonds, and other securities.

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Mutual Funds

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This is considered an IOU and the higher the interest rate (or coupon rate) on this, the more risky it is

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Bond

Front

Which of the following is a way to start investing? Purchase stocks on your own, Pool money into a mutual fund managed by an advisor, Purchase part of an index fund, Hire a financial advisor to make a plan for you, All options are correct

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All options are correct