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.
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.
2.
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.
3.
The greater potential return that investments offer in return for accepting greater risk is called ________.
Choose wisely. There is only one correct answer.
Risk premium. This is the "reward" for taking on risk.
4.
Inflation affects _______.
Choose wisely. There is only one correct answer.
Both the value of investments and interest rates. Inflation affects both, which is why many investors watch it carefully.
5.
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.