Investor Knowledge Quiz

Julie Jason's Reader Survey, December 2019

Please complete this survey to assess your level of investment knowledge, conducted by Julie Jason, JD, LLM, award-winning author & columnist, and Founder of Jackson, Grant, Investment Advisers, Inc.

The following 10 multiple-choice questions cover various investment-related topics and concepts. This quiz is based on the Financial Industry Regulatory Authority Investor Education Foundation’s National Financial Capability Study.

Question Title

* 1. In general, investments that are riskier tend to provide higher returns over time than investments with less risk.

True

False

Don't know

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* 2. The past performance of an investment is a good indicator of future results.

True

False

Don't know

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* 3. If you buy a company’s stock...

You own a part of the company

You have lent money to the company

You are liable for the company’s debts

The company will return your original investment to you with interest

Don't know

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* 4. Which of the following best explains why many municipal bonds pay lower yields than other government bonds?

Municipal bonds are lower risk

There is a greater demand for municipal bonds

Municipal bonds can be tax-free

Don’t know

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* 5. If you buy a company’s bond...

You own a part of the company

You have lent money to the company

You are liable for the company’s debts

You can vote on shareholder resolutions

Don’t know

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* 6. What is the main advantage that index funds have when compared to actively managed funds?

Index funds are generally less risky in the short term

Index funds generally have lower fees and expenses

Index funds are generally less likely to decline in value

Don’t know

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* 7. Over the last 20 years in the U.S., the best average returns have been generated by:

Stocks

Bonds

CDs

Money market accounts

Precious metals

Don’t know

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* 8. You invest $500 to buy $1,000 worth of stock on margin. The value of the stock drops by 50%. You sell it. Approximately how much of your original $500 investment are you left with in the end?

$500

$250

Don’t know

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* 9. If a company files for bankruptcy, which of the following securities is most at risk of becoming virtually worthless?

The company’s preferred stock

The company’s common stock

The company’s bonds

Don’t know

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* 10. Which is the best definition of “selling short”?

Selling shares of a stock shortly after buying it

Selling shares of a stock before it has reached its peak

Selling shares of a stock at a loss

Selling borrowed shares of a stock

Don’t know

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* 11. Please provide your contact information

First Name

Last Name

ZIP/Postal Code

Email Address