Test your basic knowledge |

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






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






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






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






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






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






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






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






10. High interest rate than savings account - safe return of principles - less volatile than stocks - regular income - diversification of portfolio - low purchase price - ease of management - municipal bonds are tax free






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






12. The degree to which an asset or security can be bought or sold in the market without affecting the asset's price






13. Not much risk is involved






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






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






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






17. Securities exchanges - over the counter market






18. Medium amount of risk is involved






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






20. 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






21. Corporate earnings - earnings per share - price earnings rato (PE) - dividend payout - dividend yield - total return - beta - market to book ratio






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






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






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






25. Fundamental analysis - technical analysis - efficient market theory






26. Online research about listed companies






27. A marketable fixed interest U.S. government debt security with a maturity of more than 10 years






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






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






30. 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






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






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






33. 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






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






35. 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






36. Stocks buy& hold - dollar cost averaging - direct investment and DRIPS






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






38. Call feature - sinking fund - serial redemption






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






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






41. An order that an investor makes through a broker or brokerage service to buy or sell an investment immediately at the best available current price






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






43. A debt security issued by a corporation and sold to investors - higher risk higher risk and government bond






44. 1. What will you use money for 2. how much will you need 3. how long will it take 4. are there obstacles 5. will you make sacrifices 6. what if you don't reach the goal






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






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






47. 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






48. A lot of risk is involved






49. Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares after a predetermined date






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