Personal Finance > Stocks 2.

Investing in common stocks is perhaps one of the most potentially profitable types of investment. When you buy a stock, you become one of the company owners. Naturally, only a small number of stockholders own significant portions of the company. Usually with company ownership you get the rights to attend shareholder meetings, to cast a vote and to collect dividends, if applicable. Nevertheless, most people buy stocks (through traditional or online brokers) in order to make profit when the stock price goes up.

Even though investing in stocks has proven to be extremely lucrative for some people (think Warren Buffet and Berkshire Hathaway shareholders), it is not risk-free. In fact, there's always a possibility of loosing your entire investment. Moreover, certain strategies, such as short selling, can potentially lead to unlimited losses. Therefore, it is very important, especially for the new investors, to seek help of qualified investment professionals, such as stock brokers and financial advisors knowledgeable about the stocks. You may also consider investing in mutual funds managed by professionals with proven track record.

The quiz on this page will not make you the best stock picker, but it may help you learn some basic information about stocks, stock indexes and different types of companies.

Note: To obtain financial advice, please contact a qualified professional.

Also of interest: Online Mortgage Calculator

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