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An investor owns three common stocks Each stock independent of the others?
Wiki User
∙ 11y ago
Probability that stock A will increase in value = 1/3
Probability that stock A will not increase = 2/3
If stock A does not increase, Stock B and C must increase.
2/3 * 1/3 * 1/3 = 2/27
Similar for Stock B ( A and C must increase) or for C (A and B must increase)
2/27 * 3 = 6/27
One additional possibility exists where A, B, and C all increase
1/3 * 1/3 * 1/3 = 1/27
6/27 + 1/27 = 7/27 = 0.259 <====
Wiki User
∙ 11y ago
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What is an investor?
An Investor is someone who buys stocks..Eg..I am a investor becasue i by into a stock
An investor by investing in combinations of stocks develops a portfolio?
An investor develops a portfolio by investing in combinations of stocks with the intention of diversifying their investment and reducing risk. This portfolio is typically made up of different types of stocks, such as growth stocks, value stocks, and dividend stocks, as well as stocks from various industries and sectors. The allocation of stocks within the portfolio is based on the investor's risk tolerance, investment goals, and market conditions.
Does a corporation makes money when an investor buys it stocks?
False
Are there financial dangers in buying stocks online?
The major danger of buying stocks online is investor incompetence. A broker can generally get a better return than an untrained investor (though there are exceptions).
What are two main ways that an investor can get a return from stocks?
money back
The disposition effect explains what quirk of investor behavior?
Quickly sell appreciating stocks while hanging on to depreciating stocks
How can one assess what stocks to buy?
It is very important for someone who is going to begin buying and selling stocks to assess which stocks to buy. Some are for long term holding, and others are for short sale. The investor needs to understand their investing goals. Individuals need to assess their own stocks, however for help on assessing stocks they can check sites like: etoro, Fidelity, or Vanguard.
Kinds of stocks?
there are: Common stocks Preferred stocks 05/08/08 there are: Common stocks Preferred stocks 05/08/08 there are: Common stocks Preferred stocks 05/08/08
Why is it important to learn how to buy stocks?
Stocks serve as a wonderful investment opportunity for individuals who know what they are doing. By understanding how to buy stocks, the investor can target companies where current stock has potential to increase in price, thus allowing the investor to later sell any current stock holdings for a profit.
What is the process where an investor borrows a percentage of the purchase price of stocks from the brokerage firm?
margin
Which is better bonds or stocks?
If you are a medium to high risk investor then Stocks are good for you If you are a low to medium risk investor then Bonds are good for It all depends on how much of a risk you can take. By investing in stocks you may make profits but you may incur losses as well. But in case of bonds the profits might be less but they are assured.
Why might an investor choose to buy bonds insteasd of stocks?
Guaranteed return upon maturity
