Question

Stocks tend to make better short-term investments, while bonds tend to make better long-term investments. Please select the best answer from the choices provided T F

Answer 1

The statement is Correct.

Step-by-step explanation:

Stocks are the share of a person in a specific company. With the financial ups and downs of the company, the person can get benefit out of the stocks in a short period of time. For example, if a person buys stocks of a company and the stocks touch a high within a week, then the person can sell those stocks and can enjoy the profits on them. On the other hand, bonds are the investments which are usually held with the financial institutions for a long period of time, usually for 5 or 10 or 15 or 20 years of time, by enjoying an interest percentage of the amount. So the statement is true that bonds are better long term investments whereas stocks are better short term investments.

Answer 2

Hi,

False

Explanation

Stocks are the stake of ownership a person has in a company where as bonds are debts. Due to fluctuating nature of the stock markets, stocks are riskier in the short term but in valuable in the long-term. Bonds work on fixed interest rates that the issuer buys from the investor. Bonds are safer investments in the short term and a good start for new investors.

Hope this helps!