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What is an example of speculation in relation to the stock market quizlet


Speculation: act of buying stocks at great risk with the anticipation that the prices will rise.

How did speculation affect the stock market?

The biggest reason to avoid speculation in stock trading is the fact that it often hurts a stock, rather than helps it. Speculation often leads to panic in volatile markets. Losing investors start to sell off their positions, which causes their stocks to go down even further, which leads to even more selling and so on.

What is speculative stock quizlet?

(1) speculative companies - those whose assets involve great risk but those that also have a possibility of great gain; (2) speculative stocks - possess a high probability of low or negative rates of return and a low probability of normal or high rates of return.

What are speculative stocks examples?

Speculative stocks tend to be clustered into sectors or types: penny stocks, emerging market stocks, rare materials stocks, pharmaceutical stocks, etc.

What was the stock market speculation?

Speculation is the act of buying or selling assets that have an increased chance of significant losses. Speculation is common among investors who trade penny stocks and over-the-counter (OTC) investments. Speculation should be limited to ensure that long-term financial goals like retirement are not impacted.




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