How To Invest Flashcards
1
Q
What are some factors to consider when determining the “right price” of an investment?
A
- How the management will perform
- What competitors will do
- How the economy will perform
- How government policy will effect the business
2
Q
What are some factors of an investment that cannot be accurately predicted?
A
- Management mistakes or departures
- Economic recession
- New competition
- Technological developments
- Regulatory changes
- Emerging social changes
3
Q
What are three traditional types of investments?
A
- Fixed Income / Bonds
- Public Equities / Stocks
- Real Estate
4
Q
What is an ETF?
A
An Exchange Traded Fund.
5
Q
What makes an ETF?
A
- Track market performance
- Do not attempt to pick the best stocks and bonds
- Rely heavily on computer-driven models rather than human judgment
- Can be purchased and sold through a public exchange at extremely small fees
6
Q
What is the SEC?
A
The Securities and Exchange Commission
7
Q
What is a commodity?
A
A commodity is a raw material or primary agricultural resource that can be bought and sold.
8
Q
A
9
Q
What are the four basic places you can give your money in the United States of America?
A
- Spend it yourself
- Give it to your children
- Give it away to charity
- Give it to the government
10
Q
How could somone use debt in investing?
A
This strategy is called leverage. When you borrow money at a lower interest rate than your expected returns to generate higher profits.
