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Questions and Answers
What is the meaning of ROI in investing?
What does IPO stand for in the context of investing?
What does SEC stand for in the context of investing?
What is the primary purpose of diversification in investment?
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What does ETF stand for in the context of investing?
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Study Notes
Investing Terms
- ROI stands for Return on Investment, a measure of the return or profit that an investment generates in relation to its cost.
Initial Public Offering
- IPO stands for Initial Public Offering, the first sale of stock by a company to the public, allowing it to raise capital and become a publicly traded company.
Securities and Exchange Commission
- SEC stands for Securities and Exchange Commission, a US government agency responsible for protecting investors, maintaining fair and orderly markets, and facilitating capital formation.
Diversification
- The primary purpose of diversification in investment is to reduce risk by allocating assets across different classes, industries, or geographic regions, thereby minimizing the impact of any one investment's performance on the overall portfolio.
Exchange-Traded Funds
- ETF stands for Exchange-Traded Fund, an investment fund that is traded on a stock exchange, like individual stocks, and tracks an index, commodity, or sector, offering diversification and flexibility to investors.
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Description
Test your knowledge of investing principles with this quiz covering key vocabulary and concepts such as stocks, bonds, portfolios, assets, liabilities, dividends, and more.
