Investing Basics
What is investing?
Allocating resources with the expectation of generating profit.
What is a bond?
A debt investment where an investor (donating citizen) loans money to a borrower (government).
What does RSI stand for?
Relative Strength Index.
What is a risk-free rate?
The return on an investment with zero risk, often represented by government bonds.
What is it called when you buy a stock because your friend said it's "guaranteed" to go up?
FOMO (Fear Of Missing Out) Investing.
Define compound interest.
Interest on both the principal and the accumulated interest.
Name a type of real estate investment.
Ex/ Rental properties.
What is a moving average?
A stock's average price over a specific period.
What is volatility?
A measure of the price fluctuations of an asset or market.
What do you call it when you panic-sell your stocks during a market dip?
"The Chicken Dance." (Because you're too scared to stay in the market!)
What is a dividend?
A portion of a company's earnings paid to shareholders.
What is a mutual fund?
A pool of money from many investors to buy a diversified portfolio of stocks, bonds, or other securities.
What is a candlestick chart?
A type of chart used in technical analysis that displays the high, low, open, and close prices for a security.
What does diversification reduce?
Risk.
What’s the term for checking your investment account every 5 minutes and freaking out over small changes?
What does ROI stand for?
Return on Investment.
What is an ETF?
Exchange-Traded Fund, which is a type of investment fund traded on stock exchanges.
What is a support level in technical analysis?
A price level where a stock tends to find support as it falls, preventing it from falling further.
Explain the risk-reward ratio.
The balance between the risk of loss and the potential reward.
When you accidentally invest in a company because its name sounded cool, what’s that called?
"Name-Brand Investing." (Who knew 'CoolTech' was just a t-shirt company?
What is the first rule of investing according to Warren Buffett?
"Never lose money."
What is the name of the first and most well-known cryptocurrency?
Bitcoin (BTC).
What is a trend line?
A line drawn on a chart to show the general direction that a stock or market is moving over time.
What is the term for losing everything on a high-risk investment?
"Going bust."
What’s it called when you buy a stock just because it’s been trending on social media without doing any research?
"Jumping on the Bandwagon."