Questions from General Investment


Q: Why may the annual growth in a fund’s net asset value not

Why may the annual growth in a fund’s net asset value not be comparable to the return earned by an individual investor?

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Q: How may beta coefficients be used to standardize returns for risk to

How may beta coefficients be used to standardize returns for risk to permit comparisons of mutual fund performance?

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Q: How may realized returns be adjusted for risk so that investment performance

How may realized returns be adjusted for risk so that investment performance may be judged on a risk-adjusted basis?

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Q: What is a value-weighted average? Why does such an

What is a value-weighted average? Why does such an average place more emphasis on such firms as Microsoft and ExxonMobil than on other companies?

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Q: How does the computation of the Dow Jones Industrial Average differ from

How does the computation of the Dow Jones Industrial Average differ from Standard & Poor’s 500 stock index and the Value Line index?

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Q: Why may averaging percentage changes produce an inaccurate measure of the true

Why may averaging percentage changes produce an inaccurate measure of the true rate of return?

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Q: Historically, what rates of return have investors earned on investments in

Historically, what rates of return have investors earned on investments in common stocks?

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Q: What is the advantage of using a relative rather than an absolute

What is the advantage of using a relative rather than an absolute scale to construct graphs of security prices?

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Q: What is the problem with time lags in technical analysis and why

What is the problem with time lags in technical analysis and why may the analysis lead to self-fulfilling predictions?

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Q: What is dollar cost averaging? What is averaging down? Why

What is dollar cost averaging? What is averaging down? Why may averaging down result in poor investment decisions?

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