Chapter 10 Flashcards
1
Q
Active Funds
A
Ran by managers who pick stocks
2
Q
Passive Funds
A
mimic a broad stock market index
3
Q
Efficient Market Hypothesis
A
The prices of traded assets reflect all publicly available information.
4
Q
Technical Analysis
A
is an approach that looks for patterns in stock and asset prices.
5
Q
Diversification
A
lowers the risk of your portfolio
6
Q
Buy and Hold
A
to buy stocks and hold them for the long run
7
Q
Rule of 70:
A
if the rate of return of an investment is x% then the doubling time is 70/x years
8
Q
Risk-return trad-off
A
higher returns come at the price of higher risk
