Strategy Intermediate: Market Timing

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1.
One advantage of market timing is that it gives you a strategy.
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True. It gives you a strategy you can use.
2.
Market timers try to buy high and sell low.
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False. Market timers try to buy low and sell high.
3.
Market timing uses fundamental analysis to predict market changes.
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False. Market timing uses technical analysis to predict market changes.
4.
A whipsaw occurs when a successful timing strategy is executed and the investor makes gains on his or her trades.
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False. A whipsaw indicates investors are reversing themselves and may be losing money on the transactions.
5.
Which type of allocation changes assets in response to short-term market changes?
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Tactical asset allocation. Tactical asset allocation changes assets in response to short-term market changes.