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Strategy Beginner: Long-Term Investing

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1.
Which of the following weathers market downturns best, on average?
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Long-term investments. The longer you invest, the more likely you will be able to weather market downturns.
2.
Tax-deferred investment accounts usually come with early withdrawal penalties.
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True. Early withdrawal penalties are meant to keep money in investments for long periods.
3.
A disadvantage of many long-term investments is that they are not liquid.
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True. There is a risk of loss for many long-term investments if they are liquidated.
4.
Dividends are _______.
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Shared company profits. Dividends are investors cuts of company profits.
5.
Bonds with short maturities are effective investments for long-term investors.
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False. Bonds with long maturities are effective investments for long-term investors.