Investing 101 & Investing 102 Review HTMW
If you had invested $100 in 1972 in the 500 stocks of the S&P500 Index, how much would you have had in 2018?
$1,612
How many companies are in the Dow-Jones Industrial Average?
30
The company Apple has how many shares outstanding?
5,575,000,000 shares
What does it mean to "Diversify" your portfolio?
A and B (To hold more than 1 stock & For your stocks to not be all in the same area of the economy)
What does a balance sheet represent?
A company's total assets and liabilities on a certain date
What does stock represent?
A percentage of ownership of a company including assets and profits
What is a mutual fund?
A pool of securities you can buy as an investment
How can you tell what professional stock analysts recommend?
All of the above (SeekingAlpha.com, The Analysts page of the Quotes tool, Searching for stock symbols on business websites)
What tools does this simulator have to help you choose stocks?
All of the above (Suggested Stocks lists, Current market news, Research tools with company information and quotes)
What is an Index ETF?
An ETF that tracks a stock index, like the S&P 500
Who would be the most likely to buy an Inverse ETF?
An investor who normally is not able to short-sell in their portfolio
Who would be the least likely to buy a Leveraged ETF?
An investor who thinks the underlying index will slowly go up over time
General Electric (GE) was the longest-running member of DJIA, from 1896 through 2018 (133 years). Use the "Historical" tab of the Quotes tool to find GE's opening stock price on December 31st, 2014
Between $151 and $200
What makes up a "Ticker Symbol" in the United States?
Between 1 and 5 letters only
What is the most common winning investment strategy for new beginners?
Buy what you know
What is the DJIA named after?
Charles Dow and his statistician Mr. Jones
What do "Prepaid Expenses" count towards?
Current Assets
Which of these is different between ETFs and Mutual Funds?
ETFs usually have lower fees than mutual funds
What should you look for when buying stock of a company you know?
If their stores always seem busy
What is a danger of over-diversification?
If your investments are spread thin, it is hard to beat the market
Why would you want to diversify between sectors?
In case a sector-wide event causes all stocks to drop
Which is a characteristic of open-ended mutual funds?
Investors typically hold fractions of shares
Why do investors pay close attention to income statements?
It is an accurate snapshot of a company's performance over a specific period of time
Why do investors use financial statements when conducting fundamental analysis?
It lets investors compare companies directly, apples to apples
Why did investors start using ticker symbols?
It was faster to move news using telegraphs with short names
How do you buy ETFs?
Like a stock, with the price constantly updating
If you choose a Passive investing strategy, how will your portfolio look with its first allocation?
Mostly ETFs of industries you think will grow
Which of the following is something you could find using the Cash Flow statement?
Movement of liquid cash in and out of the company
What is one difference between Mutual Funds and ETFs?
Mutual Funds cannot be day-traded
What is a disadvantage of Mutual Funds?
Mutual funds can have maintenance fees regardless of fund performance
What does the "bottom line" refer to?
Net Income
Where did traders in New York originally meet?
Outside near a buttonwood tree
What is a good way to stay diversified?
Re-balance your portfolio every 3 months
Where were stocks first created?
Rome
What is preferred stock?
Stock that gets paid dividends first
Over the last 30 years or so, which investment produced the highest percentage returns?
Stocks
Over the last 90 years, which investment produced the most volatile returns?
Stocks
What was the biggest event leading to stocks being the most frequently traded security type on the exchange?
The Industrial Revolution
How can you find stock news about any company?
The Quotes page
What does a Stock Quote represent?
The last price a seller and buyer agreed to to make a trade
In the late 1800s, what factors led to the growth of the NYSE?
The need for funds to finance new companies and build railroads
Which of these items can you find in a stock quote?
The stock's current daily volume
What is "Net Change"?
The total amount a stock's price has changed since the previous trading day
What does an income statement represent?
The total revenue and expenses a company used to do business over a period of time
What does it mean if a stock is near its Resistance line?
The trend suggests the stock's price will fall
Why would a stock have a ".A" at the end of its ticker symbol?
There are multiple classes of stock for this company
How would a company's management team use the Cash Flow Statement?
To determine short-term liquidity
What is Capital Preservation?
To make sure you don't lose your initial investment
Which of these items would NOT appear on a balance sheet?
Total revenue from the previous year
Where can you find a company's Cash Flow statement from the Quotes page?
Under "Filings"
What is an IPO?
When a company first sells shares of stock to the public
Which is one major advantage of mutual funds?
You have a fund manager so you do not need to constantly monitor your investments