Strategy Intermediate: Market Timing

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1.
The best time to buy a stock is when its price chart is closest to its _______.
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Support level. The best time to buy a stock is when its price chart is closest to its support level.
2.
Market timing uses fundamental analysis to predict market changes.
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False. Market timing uses technical analysis to predict market changes.
3.
A mutual funds volatility may be reduced by market timing.
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True. When used skillfully, market timing can reduce a mutual funds volatility.
4.
A stock that has its performance tied to economic trends is called a(n) _______.
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Cyclical stock. A cyclical stock moves up and down with trends in the overall economy.
5.
Market timing strategies always outperform the market.
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False. Even the best market timing strategies sometimes underperform the market.