Financial IQ Test  
What is your financial IQ? Take this 8-question quiz to find out! If you don’t like the results, try again. You will be asked a different set of questions.
     


Variable life insurance:

Offers tax deferral.
May provide higher return potential and greater risk than a whole life policy.
Allows you to invest a portion of the premium in various subaccounts.
All of the above.

The term generally used to describe the market in which prices fully reflect all available information is:

The greater fool hypothesis.
Random walk hypothesis.
The size-effect hypothesis.
Efficient markets hypothesis.

Long-term care insurance:

Is only for the very elderly.
Can help protect assets from the cost of a nursing home stay.
Is not necessary since Medicare always covers long-term care.
Is always available regardless of your past health history.

Beta is commonly used as a relative measure of risk. It measures:

Standard deviation of a stock’s price.
The expected total returns of a diversified portfolio.
The unsystematic risk component of an investment.
The risk of a security or portfolio relative to the overall market.

Investments in CDs:

Are riskier than investments in stocks.
Are inferior to investments in 8-tracks and vinyl records.
Are always tax deferred.
Are insured by the FDIC, but have generally underperformed stock investments over the long run.

The number of stocks that make up the Dow Jones Industrial Average is:

5,000.
500.
30.
10.

Buying on margin::

Precludes the advantage of using leverage.
Is not affected by limits on borrowing established by ERISA.
Minimizes losses if the price of a security declines.
Is possible by borrowing from a broker.

Technical analysis is a technique based on factors that are inherent to the market and include:

Number of shares sold on a specific day.
Number of consecutive days of price increases of a stock.
Changes in the direction of movement of a market index.
All of the above

 
   
   
Diamond Financial Solutions
Cameron Park, CA
Phone: California (530) 672-9028 Fax: California (888) 869-7609
kwright@aicinvest.com