motiva8
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Question of
What does it mean to be diversified?
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A Having as much money in bonds as you do in stocks
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Owning investments that react differently to market or economic events
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Owning at least 20 stocks in whatever industry you think will perform best
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Question of
What is false diversification?
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When all your investments move to different rhythms
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When some of your investments are up while others are down
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Owning a lot of investments that all move up and down together
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Question of
What do you get when you buy a share of a mutual fund?
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A share of all the investments the funds owns
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A ownership stake in the mutual funds company
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The right to vote at shareholders meeting for the companies the mutual funds owns
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Question of
Which of the following is a key difference between ETFs and mutual funds?
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ETFs trade throughout the trading day while mutual funds trade once per day
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ETFs are passively managed while mutual funds are actively managed
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Mutual funds have managers while ETFs are unmanaged
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Question of
What is a sales load on a mutual fund?
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Another name for an expense ratio
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How many shares of the mutual fund are sold on any given day
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A commission paid by the investor when buying or selling the fund
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Question of
What is a basis point?
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A measure used to express differences in interest rates, equal to 0.01%
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A measure used to express differences in interest rates, equal 0.1%
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A term the financial industry invented to further confuse investors about how their investments are performing
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Question of
What does it mean to short a stock?
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To only pay for part of your stock purchase
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To sell stock you don’t own
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To sell part of your losing position in a stock
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