Questions from General Investment


Q: In the context of Dow theory, what are the three forces

In the context of Dow theory, what are the three forces at work at all times? Which is the most important?

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Q: Suppose you are flipping a fair coin in a coin-flipping

Suppose you are flipping a fair coin in a coin-flipping contest and have flipped eight heads in a row. What is the probability of flipping a head on your next coin flip? Suppose you flipped a head on...

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Q: To a technical analyst, what are support and resistance areas?

To a technical analyst, what are support and resistance areas?

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Q: Briefly explain mental accounting and identify the potential negative effect of this

Briefly explain mental accounting and identify the potential negative effect of this bias.

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Q: Refer to Figure 4.5. Look at the three-

Refer to Figure 4.5. Look at the three-year performance for the funds listed. Why do you suppose there are so few poor performers? Hint: Think about the hit TV show Survivor. Figure 4.5:

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Q: Why do 401(k) plans with more bond choices tend

Why do 401(k) plans with more bond choices tend to have participants with portfolios more heavily allocated to fixed income?

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Q: In the context of behavioral finance, why do men tend to

In the context of behavioral finance, why do men tend to underperform women with regard to the returns in their portfolios?

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Q: What is the “illusion of knowledge” and how does it

What is the “illusion of knowledge” and how does it impact investment performance?

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Q: What does it mean to be a contrarian investor? How would

What does it mean to be a contrarian investor? How would a contrarian investor use technical analysis?

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Q: What are pure discount securities? Give two examples.

What are pure discount securities? Give two examples.

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