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Use of English

Level C1

Part 3 - Word Formation

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For Questions 1-8, read the text below and use the word given in capitals to form a word that fits in the gap.

Understanding the Stock Market

For many people, the stock market seems (0) MYSTERIOUS (MYSTERY): a place where fortunes are made and lost in minutes. In reality, most long-term investors rely less on luck than on careful (1) .......... (ANALYSE) and a clear strategy. One key concept is (2) .......... (DIVERSE). By spreading money across different sectors and regions, investors reduce the risk that a single event will damage their entire portfolio. Another factor is market (3) .......... (VOLATILE), which can be triggered by interest-rate decisions, political uncertainty, or even rumours on social media. Because prices move quickly, some traders act on (4) .......... (SPECULATE) rather than solid evidence, hoping to profit from short-term swings. However, this approach can lead to (5) .......... (CONSIDER) losses if the market turns against them. For this reason, many advisers recommend setting realistic goals and avoiding (6) .......... (IMPULSE) decisions. It is also worth remembering that financial news is not always (7) .......... (OBJECT). Headlines may exaggerate trends to attract attention, which can cause unnecessary panic. Ultimately, a basic understanding of how markets function can make investing feel far less (8) .......... (INTIMIDATE).

What to do

For each gap you get one word in capitals which you have to change so the grammar and meaning fit in the sentence. Here you have to show how well you know word families and if you can change words by using prefixes and suffixes.

You need to read the whole text to get the writer’s opinion on the topic. That’s because sometimes a negative prefix will be required. There is usually at least one word requiring a negative prefix, so look out for these.

In the exam always write something. You never know, you might be lucky even if you are not sure of the answer!

Strategy

  1. Read the title and the whole text so that you understand what it is about.
  2. Look at each sentence in detail.
  3. Think about what kind of word you need and whether you need a negative prefix or a suffix.
  4. Read the sentence again to check whether you need a plural form.
  5. Check your spelling, as it must be correct.

Instructions

For Questions 1-8, read the text below and use the word given in capitals to form a word that fits in the gap.

Exercise Details

Author

James Ford

@james-ford

User Prompt

"Create an exercise exploring the stock market"

Tone: Standard
Level: C1

Created on:

Mar 25, 2026

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