Home > Strategy > Beginner
Strategy Beginner: Introduction to Investment Strategy

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
Investments in which earnings are allowed to build tax-free are called ______.
Choose wisely. There is only one correct answer.
Tax-deferred. Tax-deferred investments are those in which earnings are allowed to build tax-free until you receive them as income.
2.
Investors diversify to reduce the risks of different business trends.
Choose wisely. There is only one correct answer.
True. Diversifying helps them avoid any particular trend affecting their investments too much.
3.
If you might need to use your principal soon, which aspect(s) of trading would especially concern you?
Choose wisely. There is only one correct answer.
Maturity date and minimum investment. Minimum investment determines how much of your principal will be tied up, and the maturity date how long.
4.
If your investment strategy is risk-averse, you avoid risk whenever possible.
Choose wisely. There is only one correct answer.
False. A risk-averse strategy does not seek to avoid risk entirely, but to get the best possible return at the lowest possible risk.
5.
If you might need to borrow against your principal, you need _______.
Choose wisely. There is only one correct answer.
A collateral investment. A collateral investment can be used to secure a loan.