Individual stocks are popular investments that are easy to sell and have the potential to earn significant income for investors. However, they fluctuate wildly in price, increasing the likelihood that an investment fails. What is the risk, return, and liquidity on this type of investment?(1 point)

Question

Responses

low risk, high return, and good liquidity
low risk, high return, and good liquidity

low risk, low return, and poor liquidity
low risk, low return, and poor liquidity

high risk, high return, and good liquidity
high risk, high return, and good liquidity

high risk, high return, and poor liquidity

Answer 1

The correct response is:

high risk, high return, and good liquidity

Individual stocks can offer high returns due to their potential for price appreciation. However, they also carry a high level of risk due to their price volatility. Additionally, individual stocks are generally considered to have good liquidity, meaning they can be bought and sold easily in the market.