Choose wisely. There is only one correct answer to each question.
0%
Keep studying!
Review your answers below to learn more.
1.
For the average investor, an alternative to chasing funds for the next big performer is to do regular _______ of your portfolio.
Rebalancing. With rebalancing, you can add or remove holdings based on how they perform. That is an alternative to chasing after the latest hot funds.
2.
If you are an average investor but want to invest in a volatile fund, a safe and wise idea is to do it through dollar cost averaging.
True. Investing a little at a time like this can help you keep your head and even do well.
3.
Which fund types often treat fickle investors the worst?
Sector- and region-specific funds. Investors suffer most with volatile sector and regional funds, in which volatility and temptation are highest.
4.
Fickle investors sabotage their investment returns by _______.
Buying funds when they are hot and selling them when they turn cold. Fickle investors buy what's hot and sell what's not. Dollar-cost-averaging investors invest a little at a time.
5.
If you are afraid of becoming a fickle investor, you should _______.
Dollar-cost average into funds. Investing a little at a time by setting up a regular dollar-cost-averaging program will prevent you from becoming a fickle investor.
