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LET’S PRACTICE
Reflecting on… Investing 101
Name: _____________________________________________________________________________
Mutual Fund
Gunnar and Eloise, Investors! Let’s catch up with our friends Eloise and Gunnar. They have been working hard to build wealth. They have four months of living expenses safely tucked away in their savings account and are now considering investing. Can you help them?
1. Gunnar and Eloise wonder: what is a collection of investments is called…? ___________ PRODUCT PREVIEW 2. Eloise and Gunnar have read that they should “diversify their portfolio” . What does that mean and why would they do that? _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ 3. Gunnar is not totally on board with all this investment stuff. His long term financial goal is to build a large net worth over the next 20 years . He thinks they should just keep their money in a savings account. Advice? _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ 4. What are the four main asset classes ? Provide examples of each. _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ 5. Eloise is confused. Some times she hears people talk about stock and sometimes they say equities . Are these the same things? __________ 6. Eloise wants to build their investment portfolio. As part of her diversification strategy, she wants to own stock that provides a regular income stream . What kind of stock should she buy and why? _ ______________________________________________________________________________ _ ______________________________________________________________________________
THE 21st CENTURY STUDENT’S GUIDE TO FINANCIAL LITERACY 209
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