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Module 5 Quiz: Investing Strategies

What is the primary goal of Dollar-Cost Averaging?

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What is the primary goal of Dollar-Cost Averaging?

A

Avoid investing during dips

B

Maximize short-term gains

C

Reduce the impact of market volatility

D

Time the market perfectly

With Dollar-Cost Averaging, you invest:

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With Dollar-Cost Averaging, you invest:

A

A fixed amount at regular intervals

B

A lump sum all at once

C

A different amount depending on stock price

D

Only when the market dips

Dollar-Cost Averaging is most suitable for:

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Dollar-Cost Averaging is most suitable for:

A

Options traders

B

Long-term investors

C

Short-term traders

D

Short-term traders

What is the core philosophy behind Buy-and-Hold investing?

A

Selling after quick gains

B

Timing every market swing

C

Avoiding all stock market exposure

D

Holding investments for long-term growth

A Buy-and-Hold investor ignores:

Untitled multiple choice field

A

Day-to-day market fluctuations

*

B

Long-term trends

C

Fundamental analysis

D

Company financials

Day traders typically buy and sell stocks within:

A

A decade

B

A week

C

A single day

D

A few months

What is one major downside of day trading?

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What is one major downside of day trading?

A

High dividend income

B

Low stress and simplicity

C

Guaranteed gains

D

90% lose money over time

Which of the following is true about day trading?

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Which of the following is true about day trading?

A

It requires constant monitoring and tools

B

It provides consistent long-term gains

C

It is low-risk and passive

D

It's ideal for retirement investors

What does the phrase “time in the market > timing the market” suggest?

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What does the phrase “time in the market > timing the market” suggest?

A

Market timing is crucial

B

Staying invested long-term is more powerful than trying to predict short-term moves

C

Day trading outperforms long-term strategies

D

You should pull out during crashes

Dividends are usually paid:

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Dividends are usually paid:

A

Quarterly

B

Annually

C

Monthly

D

Once during IPO

Which types of companies are most likely to pay dividends?

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Which types of companies are most likely to pay dividends?

A

Young startups

B

Mature and stable companies

C

Rapidly growing tech firms

D

Cryptocurrency firms

What is the formula for Dividend Yield?

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What is the formula for Dividend Yield?

A

Dividend / Stock Price

B

Stock Price / Earnings

C

Earnings / Dividends

D

Dividend x Earnings

What does a low Payout Ratio typically indicate?

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What does a low Payout Ratio typically indicate?

A

The company is overvalued

B

The company reinvests a large portion of its profits

C

Unsustainable dividend payments

D

The stock will crash soon

What is Dividend Growth?

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What is Dividend Growth?

A

Increasing dividend payments over time

B

Rising stock prices

C

The company’s total revenue growth

D

Decreasing payout ratios

Historically, dividends have made up what portion of the S&P 500's total return?

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Historically, dividends have made up what portion of the S&P 500's total return?

A

Nearly 90%

B

Around 25%

C

Over 40%

D

Less than 10%

What do value investors look for?

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What do value investors look for?

A

Companies with unpredictable earnings

B

Stocks trading below intrinsic value

C

Stocks priced at or above their market value

D

Companies with high growth expectations and high P/E ratios

Who helped popularize the value investing strategy?

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Who helped popularize the value investing strategy?

A

Ray Dalio and Jim Cramer

B

Elon Musk and Jeff Bezos

C

Benjamin Graham and Warren Buffetttion Risk

D

Market Risk

Which is a typical sign of a value stock?

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Which is a typical sign of a value stock?

A

Strong fundamentals but low market price

B

High volatility with no profits

C

Huge dividends with weak earnings

D

High P/E ratio

What is the Margin of Safety in value investing?

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What is the Margin of Safety in value investing?

A

The gap between intrinsic value and purchase price

B

The price at which you sell the stock

C

The stock’s dividend payout ratio

D

The amount of tax owed on gains

Intrinsic value is:

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Intrinsic value is:

A

The market price of a stock

B

A temporary trend line

C

A long-term estimate of a company’s true worth

D

The earnings per share multiplied by 10

A stock with a P/E ratio under 15 and strong financials might be a:

*

A stock with a P/E ratio under 15 and strong financials might be a:

A

Growth stock

B

Value stock

C

Penny stock

D

Meme stock