Curricular Response
Stock vs Bond
A. The difference between Stock and Bond, a stock is when you’re a part owner of a company but a bond is when you’re a lender for a company.
B. The security that tends to have the best rewards or returns is Stock, even though is the one with the highest risk.
Risk
A. Risks and returns are almost always connected because higher expected returns come with higher risks.
B. Some steps you could take to mitigate risks while investing in stock, are:
- Know That the market is uncertain
- Taking advantage of market ebbs and flows.
- Always review your process
Balance
A. Having a “well-balanced” portfolio means having a mix of stocks and bonds, usually split evenly or with 60% stocks and 40% bonds.
B. Rebalancing is when it involves adjusting the weights of your financial assets to maintain the level of risk you choose. It’s important to “rebalance” your portfolio because that allows you to stay disciplined, buy deals when they come around, and maximize your long-term gains.
Core Competency Assessment
- I think I used an acceptable amount of information, although I might have to add a bit more. I used the Class Notebook for some information and googled some other information.
- I’m not entirely sure if investing has become a more attainable concept, I think, I would have to consult someone who knows a lot of information about investing so they could help me understand better.
- I never really knew anything about investing, so everything I learned is basically new for me, so it hasn’t really changed my perspective on anything.