Choose wisely. There is only one correct answer to each question.
0%
Keep studying!
Review your answers below to learn more.
1.
In stock investing, the profit you earn on a stock after you sell it is a _______.
Capital gain. Capital gains are the primary "oomph" that stocks can provide.
2.
If you want to add a little oomph to your mutual fund portfolio, _______.
Add a few stocks at the edges of your portfolio. Adding stocks in small doses can rev up your returns and shouldn't damage the nest egg. An all- stock portfolio will likely have more than a "little" oomph, though.
3.
As a rule, which is more volatile?
Stocks. Stocks are more volatile than funds.
4.
If you want to control how much you pay in capital gains taxes each year, which of the options below is your best choice?
Own stocks directly. Mutual funds are required to distribute capital gains that their managers realize during the year; as a result, fund investors often receive taxable distributions that they didn't want or expect. When you own stocks directly, however, you control when you buy or sell, thereby controlling your own tax destiny.
5.
Buying a collection of stocks can be cheaper than holding on to a mutual fund because _______.
Both of the above. The nature of the cost structure can benefit stock owners who hold their stocks for long periods.
