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Rajashree Posted 13 years ago
Business & Finance
please evalaute my passage
high tech gazette
stock: Not a Dream Come True
Penelope Lopez
Why do we never learn? People continue to get hurt financially by not following simple investing advice from financial advisors. Take the case of investing only in stock. This unfortunate habit goes against the first basic rule of investing: spread your risk over many types of investments in order to avoid disaster during economic downturns.
The worst cases are those of ordinary people who believe that they can research companies and pick a few that are going to do well. Even professional investment managers have trouble predicting which companies will prosper and which will stumble and fall. Investing in a few individual companies is like gambling. You may get lucky in the short term, but over your lifetime, you will have some big losses.
A second stock trap that individual investors fall into is investing heavily in their own companies. Many employees are able to buy stock from their own companies at a discount. Instead of selling some of it to diversify their holdings, they keep the stock, believing that their companies will prosper. In many cases, the companies do poorly and employees lose their jobs and their investments.
What can you do to avoid these problems? In a word, diversify! Make a variety of investments, like real estate, mutual funds, and bonds. Don't keep more than 25 percent of your money invested in your company.
Mutual funds are a particularly attractive option. The big advantage of mutual funds is that the managers of the funds buy shares of a large range of companies. This means that if one or two of the companies have a bad year, or even go bankrupt, it doesn't hurt the fund very much. Some mutual funds have a mix of domestic and international stocks and bonds. Some invest in real estate or mortgages. Mutual funds are a far less risky option than investing in individual stocks or in your company's stock. The professional fund managers are more aware of market conditions and can react quickly to changing economic situations than individual investors.
Diversifying can save you a lot of agony down the road.
What would be another good title for this article?
(A) Choosing a Financial Advisor
(B) Mutual Funds: Pros and Cons
(C) Why You Should Buy Your Company's Stock
(D) Diversifying: a Key Investment Strategy
ans (D) Diversifying: a Key Investment Strategy
Even professional investment managers have trouble predicting which companies will prosper and which will stumble and fall. Investing in a few individual companies is like gambling. You may get lucky in the short term, but over your lifetime, you will have some big losses.
In this article, prosper means ________.
(A) go bankrupt or fail
(B) increase in value
(C) make a guess
(D) be very lucky
ans (A) go bankrupt or fail
stock: Not a Dream Come True
Penelope Lopez
Why do we never learn? People continue to get hurt financially by not following simple investing advice from financial advisors. Take the case of investing only in stock. This unfortunate habit goes against the first basic rule of investing: spread your risk over many types of investments in order to avoid disaster during economic downturns.
The worst cases are those of ordinary people who believe that they can research companies and pick a few that are going to do well. Even professional investment managers have trouble predicting which companies will prosper and which will stumble and fall. Investing in a few individual companies is like gambling. You may get lucky in the short term, but over your lifetime, you will have some big losses.
A second stock trap that individual investors fall into is investing heavily in their own companies. Many employees are able to buy stock from their own companies at a discount. Instead of selling some of it to diversify their holdings, they keep the stock, believing that their companies will prosper. In many cases, the companies do poorly and employees lose their jobs and their investments.
What can you do to avoid these problems? In a word, diversify! Make a variety of investments, like real estate, mutual funds, and bonds. Don't keep more than 25 percent of your money invested in your company.
Mutual funds are a particularly attractive option. The big advantage of mutual funds is that the managers of the funds buy shares of a large range of companies. This means that if one or two of the companies have a bad year, or even go bankrupt, it doesn't hurt the fund very much. Some mutual funds have a mix of domestic and international stocks and bonds. Some invest in real estate or mortgages. Mutual funds are a far less risky option than investing in individual stocks or in your company's stock. The professional fund managers are more aware of market conditions and can react quickly to changing economic situations than individual investors.
Diversifying can save you a lot of agony down the road.
What would be another good title for this article?
(A) Choosing a Financial Advisor
(B) Mutual Funds: Pros and Cons
(C) Why You Should Buy Your Company's Stock
(D) Diversifying: a Key Investment Strategy
ans (D) Diversifying: a Key Investment Strategy
Even professional investment managers have trouble predicting which companies will prosper and which will stumble and fall. Investing in a few individual companies is like gambling. You may get lucky in the short term, but over your lifetime, you will have some big losses.
In this article, prosper means ________.
(A) go bankrupt or fail
(B) increase in value
(C) make a guess
(D) be very lucky
ans (A) go bankrupt or fail
Top answer
#1 is right but #2 is wrong. Use your dictionary for 'prosper'. Remember that for this kind of vocabulary question, the meaning is not often dependent on the text; you must simply know the definition of the word.
- #1 is right but #2 is wrong.
- Use your dictionary for 'prosper'.
- Remember that for this kind of vocabulary question, the meaning is not often dependent on the text; you must simply know the definition of the word.
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3 Answers
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#1 is right but #2 is wrong. Use your dictionary for 'prosper'. Remember that for this kind of vocabulary question, the meaning is not often dependent on the text; you must simply know the definition of the word.
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