How do stocks and bonds differ?
Stocks may help you protect your money from inflation
Stocks are loans you give out to corporations
Stocks are low risk while bonds are high risk.
Stocks are good for income while bonds are good for longterm
What does it mean to “diversify” your portfolio?
Spreading risk by investing your money in a variety of funds
Putting your money in funds that come with high fees
Pooling your money into one fund
Investing all of your money into 1-2 funds
If you invested $1,000 in Netflix 10 years ago, about how much would it be worth today?
about $5,000
about $500
over $26,000
about $10,000
How does selling shares on the stock exchange benefit companies?
they receive funds to further expand their company.
it doesn't benefit them
As an investor, what is the risk involved in investing in companies on the stock exchange?
they're not at risk
because the price of stocks can also decrease
When you purchase shares of a company in the market, who are you buying those shares from?
the bank
another shareholder
Stocks: You buy a share of a company (you get ownership of a piece of that company).
FALSE
TRUE
Which of the following is TRUE about owning a share of stock?
Owning a share means you own a percentage of the company.
You have to return the share of the company you own
The value of a share is based on the number of investors
Companies lose significant amounts of money
How does buying shares in a company benefit an investor?
can sell the shares for a higher price and make a profit
they don't benefit
Stocks are riskier than bonds but have the potential to have higher returns.
FALSE
TRUE
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