Describe an example of an equity investment

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Reference no: EM1379129

1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve.

2. How many months' worth of expenses do you think your financial reserve should include? Describe at least two reasons for this decision.

3. Would you rather have a savings account that offered simple interest, or an account that offered compound interest? Why?

4. If you were opening a savings account with compound interest, would you prefer an account that offers annual compounding, quarterly compounding, or daily compounding? Why?

5. Which strategy for saving do you think would work best for you? Why?

6. Describe two financial goals that you would want to meet before you begin investing. Explain why you would want to reach those goals first.

7. Describe at least two factors of an investment that you would want to consider before putting money into that specific investment.

8. Calculate the return on investment in dollars and as a percentage for an investment that you purchase for $500 and sell for $600.

TIP: If you don't remember how to calculate return on investment, review the Calculating ROI pages in Section 4, Lesson 2.

9. Describe two examples of debt investments.

10. Describe two examples of equity investments.

11. If you were a new investor who wanted to invest in stock, would you prefer to invest in registered public stock, or unregistered private stock? Why?

12. Describe an alternative investment that you might invest in someday, and explain why this investment is appealing to you.

13. Describe at least three other investments you want to make with your income either now or someday in the future. Explain why you think these particular investments would be good choices.

14. Describe two types of investment accounts that you might use in the future. For each type of account, list at least one reason why the type of account might be useful to you.

15. Search online to find information about a stock's performance, and then provide the information below. You could choose a stock such as Amazon.com or Google, or you could choose another stock that interests you.

a. The date you collected this information.

b. The website where you collected this information.

c. The name of the company you chose

d. The stock's ticker symbol

e. The 52 week high 

f. The 52 week low 

g. The Yield percentage 

h. The Volume of stock sold 

i. The stock's value at the close of business 

j. The net change in the stock over the course of the day 

16. Describe an example of an equity investment that can also produce income.

Reference no: EM1379129

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