31 Questions
What is the recommended number of stocks to have on your list when getting started as a do-it-yourself investor?
50 to 100 stocks
What is the purpose of settling on an investment strategy and writing it down?
To help you concentrate on only certain kinds of stocks
What is the next step after making sure you have a list of 50 to 100 stocks?
Conducting a preliminary screening
What is the purpose of reviewing your list and asking yourself about which companies you understand?
To reduce the number of stocks on your list
What should you consider when making a fair and reasonable call about a company's future profitability?
The industry in which the company operates
What is the purpose of practicing stock tracking and investing?
To become familiar with stock market trends
What is the primary goal of researching mutual funds' stock holdings?
To identify potential stocks for purchase
What is the purpose of reviewing the list of potential stocks to invest in?
To eliminate stocks that do not match investment criteria
What is the suggested number of stocks to aim for as prime candidates for purchase?
10
What does the author recommend doing after getting the list down to no more than ten stocks?
Conduct in-depth research on each stock's products and services
What cautionary advice does the author provide for investing in unfamiliar industries or companies?
To thoroughly understand the company or industry before investing
How can an individual obtain a company's annual report?
By contacting the company directly or visiting its website
What is the purpose of visiting the Public Register’s Annual Reports Service Web site?
To download free copies of annual reports
What is the author's view on investing in 'hot stocks' without understanding the underlying companies?
'Hot stocks' should be avoided without understanding the underlying companies
'Never buy a stock in a company or industry that you don’t understand' implies:
'Hot stocks' may be misleading without understanding the industry
Selecting 50 to 100 stocks is the first step recommended by the author when getting started as a do-it-yourself investor in stocks.
True
The author suggests that the resulting list of stocks after preliminary screening may be as few as 10.
False
According to the author, it is important to make cuts in your list of selected companies based on your understanding and ability to make a fair and reasonable call about their future profitability.
True
The author recommends relying solely on intuition when picking stocks.
False
The techniques described in Chapter 4 help in coming up with a list of potential stocks.
True
The author recommends concentrating on certain kinds of stocks based mainly on size and risk.
True
Reviewing mutual funds' stock holdings is an important step in selecting potential stocks for investment.
True
The author recommends having no more than 20 stocks on your list when getting started as a do-it-yourself investor.
False
The author suggests researching the eight criteria for each stock on your list before making a final decision.
True
The goal is to use tools and research resources to cut the list of potential stocks to invest in from 50 or so down to fewer than five candidates for actual purchase.
True
The author advises against investing in 'hot stocks' without understanding the underlying companies.
True
The author recommends selecting one to three stocks for purchase after reducing the list to no more than ten prime candidates.
True
The purpose of visiting the Public Register’s Annual Reports Service Web site is to obtain printed copies of annual reports.
True
The author suggests cutting out 10 or 15 stocks from the list to get down to a more manageable number to work with.
True
The author advises considering a company's product, staying power, and industry growth potential before investing in its stock.
True
An individual can obtain a company's annual report by visiting the company’s Web site and requesting or downloading it.
True
This quiz covers the process of selecting stocks, including using intuition, setting criteria, practicing stock tracking, and getting started as an individual investor. It provides guidance on how to navigate the challenges and complexities of choosing investments in the stock market.
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