Freetrade financial literacy test

Let’s all take the test looking for 100% all round.

I tried that. A few tricky questions!

‘Yield is a way of measuring how well an investment is performing and how it is expected to perform in the future’

Is not

‘Income from an investment as a percentage of its current price is known as yield.’

In not going insane there? Performance is not the same as income…

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Yield is the only way to measure performance of fixed income products though. Comparing 1-year T bills, higher yield higher performance, so not applicable to capital growth investments, but it is a way to measure past and future performance.

I can’t believe I answered all the questions and not one did I need to use :rocket: :gem: :raised_hands: or :gorilla: !

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It didn’t really ask that in relation to fixed income products though did it?

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It said “a way” not “the only way”, so probably fair.

A high yield can mean the share price is tanking, as the yield will be based on the previous dividends

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Again, a good point, but that doesn’t invalidate the question. It’s a way, it doesn’t matter how good a way it is.

but maybe the question did ask in relation to fixed income products?

The way you phrased it implied the answer in the quiz was incorrect, but it is not.