Stock Trading Strategies Quiz

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What is one strategy for trading stocks mentioned in the text?

Risk and Reward

How can investors use earnings information for stock trading?

Invest in companies with upcoming earning announcements or during earning season

What is the Dow Jones Industrial Average and what does it represent?

Collection of the thirty largest companies in the United States; it represents the average price of all the stocks in its collection

What is an ETF and how does it differ from individual stocks?

Exchange Traded Fund; a collection of stocks, assets, and securities that can be bought all at once Signup and view all the answers

How can investors use a stock screener in their trading strategy?

To research and determine if a stock is worth buying Signup and view all the answers

Why was the Dow Jones Industrial Average first calculated in 1896?

So people could see the market moving upwards/downwards as a whole Signup and view all the answers

What is the main difference between Stock Index ETFs and Volatility ETFs?

Stock Index ETFs track an existing stock index, while Volatility ETFs are based on the VIX index which measures market expectations. Signup and view all the answers

Explain the concept of Inverse ETFs.

Inverse ETFs move in the opposite direction of the tracked ETF. If the tracked ETF goes up, the inverse ETF goes down, and vice versa. Signup and view all the answers

How do Leveraged ETFs differ from regular ETFs?

Leveraged ETFs aim to double or triple the return of the tracked ETF. If the tracked ETF goes up by 1%, the leveraged ETF goes up by 2 or 3%. Signup and view all the answers

What is a key distinction between Open-Ended and Closed-Ended mutual funds?

In Open-Ended mutual funds, shareholders can cash out at any time, while Closed-Ended mutual funds have a fixed number of shares and can be traded on an exchange. Signup and view all the answers

How are Unit Investment Trusts different from Closed-Ended mutual funds?

Unit Investment Trusts have an expiration date, while Closed-Ended funds do not have a specified end date. Signup and view all the answers

Explain the purpose of Mutual Funds.

Mutual Funds allow investors to pool their money together and invest in a diversified portfolio managed by a professional. Signup and view all the answers