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Stocks Beginner: Introduction to Stocks

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1.
Buying highly volatile stocks may be _______.
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Either A or B. Buying highly volatile stocks may be the quickest way to make or to lose money on the market. Since volatile stocks have greater and/or more frequent fluctuations in value than the market as a whole, they can be the quickest way to either make OR lose money.
2.
A customer who wants nothing more than execution of trades from his or her broker will want a _______ broker.
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Deep-discount. The deep-discount broker limits his or her services to execution of trades.
3.
Common stock and preferred stock both convey the same kind of equity rights.
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False. Owners of preferred stock have prior claim to the companys assets over owners of common stock.
4.
Jim just bought 200 shares of Microsoft. He is now part owner of ______.
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All of the above. These are all examples of the companys assets. Stock ownership conveys equity in a companys assets.
5.
Common stock is less predictable than preferred stock.
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True. Since preferred stock pays a fixed premium, it is more predictable than common stock.