Question

When investing outside the United States, stocks are typically ________ U.S. based stocks.

A) as volatile as
B) less volatile than
C) more volatile than
D) more stable than

Answer 1

When investing outside the United States, stocks are typically more volatile than U.S. based stocks. This increased volatility can be attributed to various factors such as political instability, currency fluctuations, and differences in market regulations and investor sentiment.

Step-by-step explanation:

When investing outside the United States, stocks are typically more volatile than U.S. based stocks.

This means that stocks from international markets tend to experience larger price fluctuations compared to stocks from the US. This increased volatility can be attributed to various factors such as political instability, currency fluctuations, and differences in market regulations and investor sentiment.

For example, if an investor is considering investing in emerging markets such as Brazil or India, they would typically expect higher volatility due to the unique risks associated with these markets, such as changes in government policies or economic instability.