Which of the following accurately reflect appropriate investment guidelines?
I. Always invest in last years best performing mutual fund.
II. Trade frequently to increase your investment returns.
III. Sell losing stocks unless you are willing to buy them at the current price.
IV. Take corrective action when so indicated.
A) I and II only
B) III and IV only
C) I, III and IV only
D) I, II, III and IV

Question

Quizplus · Accepted Answer

III and IV are considered appropriate investment guidelines. III suggests a rational approach to evaluating underperforming investments, implying that one should only hold onto stocks that they believe are worth their current market price. IV emphasizes the importance of monitoring investments and making adjustments as necessary, which is a fundamental principle of sound investment management. I and II, on the other hand, are not considered good investment practices. Investing based on past performance (I) does not guarantee future returns, and frequent trading (II) can lead to higher costs and taxes, potentially lowering net investment returns.

Which of the Following Accurately Reflect Appropriate Investment Guidelines