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.
Companies that do not pay dividends might be good growth investments.
Choose wisely. There is only one correct answer.
True. Often, companies do not pay dividends in order to funnel more profits into growth.
2.
A reasonably intelligent person who studies the tax code from time to time can probably make good decisions about how to shelter investment income from taxes.
Choose wisely. There is only one correct answer.
False. Even the simplest workplace retirement plan can have tax implications that require expert advice.
3.
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.
4.
It is never smart to invest through a full-service broker.
Choose wisely. There is only one correct answer.
False. Investors who do not want to put in the time or effort to research and manage their investments may find a full-service broker essential.
5.
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.