What is the primary reason to establish clear investment objectives before starting to invest?

"To impress financial advisors" "To predict short-term market fluctuations" "To align investment strategies with financial goals" "To guarantee high returns on all investments"

Why is understanding your risk tolerance crucial for investment decisions?

"To completely eliminate investment risk" "To maximize returns regardless of potential losses" "To select investments aligned with your comfort level regarding potential losses" "To time the market perfectly and avoid any downturns"

What is the core concept of diversification in investment?

"Investing all your funds in a single high-performing asset" "Predicting future market trends with absolute certainty" "Spreading investments across different asset classes and sectors to manage risk" "Timing the market to buy low and sell high consistently"

How can fees and expenses impact your investment returns?

"They always guarantee higher returns" "They have a negligible impact and can be ignored" "They can significantly reduce your overall investment profits" "They are only relevant for large-scale investments"

Why is it important to determine your investment timeline?

"To become a financial advisor" "To predict the exact date of market crashes" "To choose investments suitable for your time horizon and goals" "To avoid all risks associated with investing"