Quiz: Trading, investing… or gambling?

1. 01Devon puts money on a roulette spin where the house has a built-in edge. This is best described as:

   GamblingTradingInvestingSaving
2. 02Buying a stock on a stranger's tip, with no plan, no exit, and money you need for rent is closest to:

   HedgingArbitrageInvestingGambling
3. 03Nia risked her rent money on one volatile stock and doubled it. What is the best assessment?

   Bad outcome, bad decisionGood outcome, bad decision. She risked money she couldn't afford to loseGood outcome, good decision, profit proves it was rightImpossible to say anything
4. 04After losing four trades in a row with a sound process, the disciplined response is:

   Continue following the process. Streaks are expected variance, not a signalStop reviewing decisions until results improveAbandon the process immediatelyDouble the next position to recover the losses
5. 05Why is borrowed money never risk capital?

   Because lenders forbid all investingIt is risk capital if the interest rate is lowLosing it leaves the debt behind, still compounding against youBecause borrowed money has lower returns

Answer every question to submit.