1 On a scale of 1 to 5 5 representing
1. On a scale of 1 to 5 (5 representing the highest degree of risk aversion), where do you rank the Steeles? Where do you rank yourself?
2. The Steeles are contemplating opening a stockbrokerage account. Help them in the selection process. Is the type of broker you recommend for them the same as you would choose for yourself? Explain why or why not.
3. Should the Steeles open a cash account or a margin account? Explain and also discuss which type of account is the better choice for you.
4. Explain which of the three media choices—Internet, cable news (such as CNBC), or newspapers—is the best source of investment news for the Steeles. Assume they will devote no more than two hours a week to the task. Which source(s) do you like to use? How much time do you devote to the task? Is this amount too much or too little, in your view?
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