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Are the following statements mostly True or mostly False? Let me know what you think in an email to: rfo
(at) bismarckgroup.com. If you've read "The Brainwashing of the American
Investor", please let me know. |
TRUE |
FALSE |
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1) The proper gauge of your Investment Portfolio's "Performance" is the
change in Market Value over the course of a calendar year.
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2) Mutual Funds are a safer route to long term investment success than
trying to create your own portfolio of individual securities. |
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3) "Profit Takers" and "Traders" hurt the average investor. |
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4) Index funds will always beat "the market". |
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5) The
Dow Jones Industrial Average
is comprised of Investment Grade Companies, and generally gives a clear
indication of what is going on in the Stock Market. |
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6) In the long run, investing in the Stock Market will assure you of
keeping up with inflation. |
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7) Annuities are perfect investments at retirement both for people of
limited resources and for the wealthy, particularly Variable Annuities. |
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8) Technical Analysts can predict the future movements of the economy,
individual securities, and the Stock Market with a very high degree of
accuracy. |
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9) A clear indication that you are a savvy investor is your use of an
on-line deep discount broker. |
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10) There is no such thing as a "freebie" on Wall Street. |
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11) It is important that you take your tax losses regularly,
particularly if you have held the losing position for less than one
year. |
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12) Asset Allocation is a strategy used by investors to move assets from
weak markets to strong ones in order to improve the growth of the
Investment Portfolio's bottom line. |
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13) "Sell your losers and let you profits run" is the essence of sound
Investment Management Thinking. |
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14) Closed End Mutual Funds (CEFs) are not popular with Wall Street
professionals because they are inherently more risky than normal Mutual
Funds. |
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15) It's better to buy shorter duration Corporate and Municipal Bonds,
because their Market Value doesn't fluctuate as much with anticipated
changes in the direction of interest rates. |
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16) No Load Mutual Funds are particularly good for investors because the
Mutual Fund Company does not charge anything for it's services. |
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17) Packaged Investment Products are designed with a sincere concern for
the financial well being of the average investor, and are good for
everyone. |
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18) Stock Brokers are well trained in all aspects of investing and
Investment Portfolio Management. Consequently, a significant portion of
their compensation is tied directly to how well they help their clients
develop high quality, properly diversified, and goal directed
portfolios. |
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19) Cash is an integral part of any Asset Allocation Formula because it
allows investors to "time the market" successfully. Professional Market
Timers know precisely when to move into or out of cash in anticipation
of the next major directional change in the market. |
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20) Buy and Hold continues to be the proper Investment Strategy for most
individual investors. |
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21) It is a well known fact that there are certain Core Portfolio issues
that belong in all investment portfolios if long term success is to be
expected. |
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22) Every properly diversified portfolio will have up to 5% in each of
these areas: Miscellaneous Speculative Opportunities, Gold or
other Commodities, Small Cap Stocks, and Global Mutual Funds. |
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23) Zero Coupon Bonds are an important part of the Fixed Income portion
of the Investment Portfolio, especially when retirement is contemplated
within five years or so. |
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24) If you were to prioritize the FOUR most Important
Investment Ideas, this is what you would have:
- Keep commission costs down;
- Diversify properly;
- Establish a target for
taking profits;
- Focus on reducing taxes;
- Buy high quality securities;
- Increase annual income.
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25) If an investor can learn to control his own Greed and Fear, he will
have a much better chance of investing successfully. |
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26) The second step in every stock purchase should be the establishment
of a "Stop Loss" order. Such an order assures you that your losses will
be limited to a specific percentage of your purchase price. |
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Note: Only two of these statements are completely true. The correct
answer will win you a free, inscribed, copy of "The Brainwashing of the
American Investor". |
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