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CSM Financial Management

Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. A debt security issued by a corporation and sold to investors - higher risk higher risk and government bond






2. A debt security issued by a government spending most often issued in the country's domestic currency






3. An order to buy or sell a security when it's price surpasses a certain point






4. Pay yourself and make investing automatic - save extra funds like gifts - partcipate in your employeers retirement plan - make installment payments to yourself - break a habit - get a part-time job






5. Investing stock in a company and having the risk that it will shut down






6. An investment strategy that aims to balance risk and reward by apportioning a portfolio's assets according to an individual's goal






7. An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks and bonds






8. Not much risk is involved






9. Interest income: -paid semiannually on most bonds registered bonds - bearer bonds - zero coupon bonds - dollar appreciation of bond value - bond repayment at maturity: -bond laddering






10. A nationally recognized - well-established and financially sound company






11. Shares in a company whose earnings are expected to grow at an above average rate relative to the market






12. Aggressive growth funds - equity income funds - global stock funds - growth stock funds - index funds - international funds - large cap funds - mid cap funds - small cap funds - regional funds - sector funds - socially responsible funds






13. Securities exchanges - over the counter market






14. Possible hedge against inflation - easy purchase on indirect ownership - limited financial responsibility for indirect ownership - financial leverage - positive cash flow - no management concerns on indirect ownership






15. Medium amount of risk is involved






16. Direct: primary and secondary residences - commercial property - undeveloped land - foreclosures - Indirect: real estate syndicates - limited partnerships - real estate investment trusts - mortgages - participation certificates






17. Interest rate risk - face value volatility - no hedge against inflation - principal does not appreciate - difficult to compound






18. Fundamental analysis - technical analysis - efficient market theory






19. The process of selecting investments with a higher risk in order to profit from an anticipated price movement






20. To raise money for start up - on going activities or expansion - no repayment required - dividends are not mandatory - they lose some control of the company through voting rights






21. Primary residence: you hold legal title - place to live - mortage interest is tax deductible - usually an inflation hedge - beware of housing bubbles






22. Company could fail - market volatility - uncertain yield - management time required - risk






23. High yield funds ( junk bonds) - long term corporate - long term U.S. - intermediate corporate - intermediate U.S. - short term corporate - short term U.S. - municipal bonds - world bond funds






24. Income from dividends - potential stock split - appreciation of stock value






25. By make a risky investment you can be returned with a lot of money or losing some






26. An order placed with a brokerage to buy or sell a set number of shares at a specific price or better






27. Investing in something that could have a risk of a world wide issue






28. Balance your budget including an account for investments - pay off credit cards - start an emergency fund - have access to other cash for emergencies






29. An equity security that pays regular often steadily increases dividends and offers a high yield that may generate the majority of overall returns






30. Evaluate potential investments - seek assistance if needed - monitor the value of investments - keep accurate and current records - consider tax consequences of selling






31. Combines funds of investors and invests those monies in a diversified portfolio of securities issued by corporations or governments that meet the fund objective






32. A marketable U.S. government debt security with a fixed interest rate and a maturity between one and 10 years






33. The risk that an investments value will change due to the change due to the change in the absolute level of interest rates






34. Asset allocation funds - balanced funds - value funds - money market funds - life cycle funds - funds of funds






35. The uncertainty over the future real value (after inflation) of your investment






36. Call feature - sinking fund - serial redemption






37. Debenture bond - mortage bond - subordinated debenture bond - convertible bond - high yield bond






38. Diversification - affordability - professional management - liquidity - low transaction costs - no disadvantages






39. Hedge against inflation - safe haven during political or economic upheavals - need a storage place - can be risky-not easy to turn to cash - difficult to appraise






40. Initial public offerings - investment banks






41. A short term debt obligation backed by the U.S. government with a maternity of less than one year






42. A market that exists between companies and financial institutions that is used to raise equity capital for the companies






43. Cash dividends - price appearance - hedge against inflation - low minimum investment - limited liability - liquidity






44. A stock that provides a constant dividend and stable earnings regardless of the state of the overall stock market






45. Stocks Day trading - margin buying - selling short - option trading






46. The risk inherent to the entire market or entire market segment unsystematic: company or industry specific risk that is inherent in each investment






47. Written promise to pay with legal conditions (indenture) - face value - maturity date - interest rate=coupon rate - trustee






48. Close ended funds (2%): shares are traded limited and must purchase from another investor -exchange trade funds (6%): tied to a specfic index - open end funds (92%): shares issued and redeemed by the company at net asset value (NAV)






49. A risk management technique that mixes a wide variety of invests within a portfolio






50. A portfolio management strategy and model for investing in fixed income that involves purchasing multiple bonds - each with different maturity dates







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