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Stocks 101: Stocks versus Other Investments

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1.
What is perhaps the main reason to invest in stocks as opposed to other investments?
Choose wisely. There is only one correct answer.
They provide the highest potential returns. In fact, over the long term, no other type of investment performs better.
2.
Which of the following investments are the most volatile in their pricing?
Choose wisely. There is only one correct answer.
Stocks. Stocks are the most volatile. Over the long term, stocks have a higher return than bonds or savings accounts. But this volatility means that over the short term, other types of investments may significantly outperform stocks.
3.
Which of the following investments provide the biggest long-term returns?
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Stocks. Of the types of investments listed, stocks provide the biggest long-term returns. In attempting to reach your financial goals in life, maximizing the return on your investment dollars is key.
4.
A good way to minimize the effects of bad timing in stock choices is to invest for the short term.
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False. A good way to minimize such effects would be to invest for the long term instead, since volatility tends to iron itself out over time.
5.
Which of the following skills sets is NOT needed to be a successful investor?
Choose wisely. There is only one correct answer.
Advanced statistics. Understanding advanced statistics is not needed to be a successful stock investor. The vast majority of people have all the basic skills required.
DONE