1. What are municipal bonds? Describe two different types of municipal bonds.
Municipal bonds are debt securities issued by state or local governments to pay for ongoing products such as roads, schools, and airports. The two types of municipal bonds are general obligation bonds, or revenue bonds.
2. What is asset allocation? Why is this used?
Asset allocation is when someone invests in multiple places to reduce the overall risk of investing. Individuals are reducing their overall risk, because only part of the money is being put in each investment. For example, if someone has invested in several different types of investments and their stock investment drops, they still have other investments
3. What are common stocks? What are the advantages …show more content…
Critical Thinking Questions
1. Why is it important to have your financial plan and goals in place when considering investments?
Financial planning is important because it leaves you with a method of organising your financial plans for yourself and is also about planning for the unforeseen and empowering you to have the independence to handle any unpredicted events in your life. Successful financial planning is important for anyone who wishes to stay ahead of their finances and be prepared for any unexpected disasters.
2. What is one financial goal that you have? Using what we have discussed in the unit, what strategies in saving and investing could you use to reach the goal? What are the advantages and disadvantages of the strategies that you would use?
One financial goal I have, is to be financially stable and have enough money saved up in the case of a disaster. Some strategies I would use to reach my goal are by making investments and having a savings account. I would also use stocks to gather more money in my times of need. A disadvantage of this strategy is that I could lose money instead of making it. An advantage of this is, I can make a-lot of money and be financially
Municipal bonds are debt securities issued by state or local governments to pay for ongoing products such as roads, schools, and airports. The two types of municipal bonds are general obligation bonds, or revenue bonds.
2. What is asset allocation? Why is this used?
Asset allocation is when someone invests in multiple places to reduce the overall risk of investing. Individuals are reducing their overall risk, because only part of the money is being put in each investment. For example, if someone has invested in several different types of investments and their stock investment drops, they still have other investments
3. What are common stocks? What are the advantages …show more content…
Critical Thinking Questions
1. Why is it important to have your financial plan and goals in place when considering investments?
Financial planning is important because it leaves you with a method of organising your financial plans for yourself and is also about planning for the unforeseen and empowering you to have the independence to handle any unpredicted events in your life. Successful financial planning is important for anyone who wishes to stay ahead of their finances and be prepared for any unexpected disasters.
2. What is one financial goal that you have? Using what we have discussed in the unit, what strategies in saving and investing could you use to reach the goal? What are the advantages and disadvantages of the strategies that you would use?
One financial goal I have, is to be financially stable and have enough money saved up in the case of a disaster. Some strategies I would use to reach my goal are by making investments and having a savings account. I would also use stocks to gather more money in my times of need. A disadvantage of this strategy is that I could lose money instead of making it. An advantage of this is, I can make a-lot of money and be financially