Retirement
What age does Social Security Define Full retirement as?
A share or part ownership in a company
Stock
The market is going up
Bull
Is an index fund diversified?
Yes
Reward
What 2 Retirement Plans are completely up to the individual?
Roth IRA and a Traditional IRA
What is it called when you loan a company or government money and they pay you back later with interest.
Bond
This market is going down
bear
Is this diversification?
Holly plans on investing all of her money in one stock.
No
What is dollar cost averaging?
An investment strategy that invest small amounts over time to decrease your overall risk
What 2 Retirement options are provided by the Company you work for?
What is Pension and 401k
Shares of the fund
As the demand for a stock increases, stock price ______
Rises
Does diversification increase or decrease risk?
Decrease
When overall interest rates increase to higher than what you bought your bond at, what happens to the value of your bond.
It will decrease
How does social Security build up their fund?
What is They pool contributions from current workers to then provide retirement support benefits to those who are eligible.
This is the most risky investment type of the three: stocks, bonds, index funds?
stocks
Why is it important that there are both bull and bear markets
They balance each other
What are the 2 main ways to diversify your investments?
Invest in multiple asset classes (stocks, bonds, etc.) and Invest in multiple companies/securities within each asset class
What are the 2 types of bonds that we went over? Which one is more riskier?
Corporate and Government Bonds, and Corporate bonds are more riskier.
What Retirement plan allows you to pay taxes up front as you deposit and withdraw tax free once you retire.
Roth IRA
An Index fund aims to mirror the peformance of a specific index. What is that Index?
S&P 500
How can you earn money by investing in the stock market? (write both ways)
Receive dividends from the company or sell your share at a higher price than you bought it.
Why is diversification important?
If a certain investment doesn't do well, you have others that will help balance it out so you don't lose money.
If I have 25 shares worth 4 dollars, and a 2-1 stock split occurs, how many shares do I then have? What is the stock worth? What is the total overall value?
50 shares worth 2 dollars, and the total overall value is still 100