Which of the Following Is Not True of Stocks

question 108

Multiple Choice

Which of the following is not true of stocks?

• A)Since the end of World War II, stocks have returned on average close to 10 percent a year.
• B)Since 1926, stocks had positive gains in 65 years.
• C)Since 1926, stocks lost money in 25 years.
• D)In 2009, during the economic crisis, stocks lost 37 percent.
• E)In reality, stocks do not have a place in every investment portfolio.

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Definitions:

Interest Rate Swap

A financial derivative contract in which two parties agree to exchange future interest rate payments, typically one fixed-rate and one variable-rate.

Fair Value

A financial term referring to the estimated market value of an asset, based on current market prices.

Available For Sale

A classification for financial assets indicating that they are neither held for trading purposes nor intended to be held to maturity, implying they can be sold to meet liquidity needs or strategic goals.

Idle Funds

Money that is not currently invested or used in transactions, potentially earning no interest or profit.