16 Questions
Investors generally seek larger returns over an extended period through buying and holding. True or false?
True
Traders take advantage of both rising and falling markets to enter and exit positions over a shorter time frame. True or false?
True
Investments are often held for a period of years or even decades, taking advantage of perks like interest, dividends, and stock splits along the way. True or false?
True
The goal of trading is to gradually build wealth over an extended period of time. True or false?
False
Traders will attempt to make transactions that can help them profit quickly from fluctuating markets. True or false?
True
Investors are more likely to ride out short-term losses, while traders will attempt to make transactions that can help them profit quickly from fluctuating markets. True or false?
True
Investors who take an active investing approach usually tend to monitor the markets on a regular basis and make changes accordingly.
True
Passive investors follow a buy-and-hold strategy and make an effort to closely monitor the markets on a daily basis.
False
Investors generally follow a short-term investment time horizon to achieve their goals.
False
Trading involves more frequent transactions, such as the buying and selling of stocks, commodities, currency pairs, or other instruments.
True
Buy-and-hold investors wait out less profitable positions, while traders seek to make profits within a specified period of time.
True
Trading profits can only be made by buying at a lower price and selling at a higher price.
False
Traders often employ technical analysis tools, such as moving averages and stochastic oscillators, to find low-probability trading setups.
False
A trader's style refers to the timeframe or holding period in which stocks, commodities, or other trading instruments are bought and sold.
True
Active investors generally seek out particular investments that try to underperform the returns of a specific benchmark index.
False
Passive investors seek to track the returns of the benchmark index by frequently making changes in their investment portfolio.
False
Explore the differences between investing and trading in the context of international business and trade. Understand the distinct methods of attempting to profit in the financial markets, with investors seeking larger returns over an extended period through buying and holding, while traders take advantage of both rising and falling markets over a shorter time frame.
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