Psychology of investing - Quiz

Lesson 9- Psychology of investing

1 / 18

What are the two essential components for achieving success in any venture?

Strategy and Luck

Strategy and Psychology

Knowledge and Luck

Knowledge and Psychology

2 / 18

What percentage of success is contributed by your strategy, according to the content?

70%

50%

30%

10%

3 / 18

What is the first step in the psychology of successful investors?

Developing an intricate strategy

Developing absolute discipline

Listening to rumors

None of the above

4 / 18

What is FOMO in the context of investing?

Fear Of Making Orders

Fear Of Missing Out

Fear Of Market Oscillations

Fear Of Massive Operations

5 / 18

Which of the following is a common mistake that investors often make?

Buying due to FOMO

Selling in a panic due to negative news

Both A and B

None of the above

6 / 18

During the dot-com bubble, what principle did Warren Buffett adhere to that prevented him from buying tech stocks?

Buying companies with positive cash flow, profitability, and undervaluation

Buying companies with a strong online presence

Buying companies based on their market hype

None of the above

7 / 18

What was the outcome of Warren Buffett’s investment strategy after the dot-com bubble burst?

He lost a lot of money

He made an 80% return

His investments remained the same

None of the above

8 / 18

In the context of investing, what does flexibility refer to?

The ability to adapt and change your stance when facts change

The ability to invest in multiple sectors

The ability to change brokers frequently

None of the above

9 / 18

What is the ‘sunk cost’ trap in investing?

Buying more of an underperforming stock

Holding onto an underperforming stock due to the inability to bear a loss

Selling a high-performing stock too early

None of the above

10 / 18

Is a ‘paper loss’ a real loss?

Yes

It depends on the situation

The concept doesn’t exist

11 / 18

According to the text, successful investing is about being right all the time. True or False?

True

False

12 / 18

What’s the first rule of successful investing mentioned in the text?

Hard work

Flexibility

Discipline

None of the above

13 / 18

In the scenario of the world’s best investors buying Apple stocks, what should a disciplined investor do?

Immediately buy Apple stocks

Sell all other stocks and buy Apple

Add Apple to their investment plan and assess it against their criteria

None of the above

14 / 18

According to Warren Buffett, what is important about your circle of competence?

Its size

Staying within it

Expanding it

None of the above

15 / 18

Should you follow analysts’ recommendations blindly?

Yes, always

No, never

Only if the recommendation aligns with your strategy

Only if the recommendation is about a tech company

16 / 18

What does “staying within your circle of competence” mean?

Investing in companies only within your geographical location

Only investing in what you understand

Avoiding companies outside of your industry

None of the above

17 / 18

Which company’s shares were recommended by analysts in 2011 but turned out to be an undesirable investment?

Noble Group

Apple

Berkshire Hathaway

None of the above

18 / 18

What percentage of people who embark on a weight loss journey actually lose weight, according to the content?

Less than 5%

Around 30%

More than 70%

Around 50%

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