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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 type of preferred stock with a provision that stipulates that if any dividends have been omitted in the past they must be paid out to preferred stockholders before common shareholders can receive dividends






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






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






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






6. 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






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






8. Not much risk is involved






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






10. 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






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






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






13. 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






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






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






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






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






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






19. 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






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






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






22. 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)






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






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






25. 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






26. Call feature - sinking fund - serial redemption






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






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






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






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






31. 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






32. Fundamental analysis - technical analysis - efficient market theory






33. Initial public offerings - investment banks






34. 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






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






36. A stock that rises quickly when economic growth is strong and falls rapidly when growth is slowing down






37. Online research about listed companies






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






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






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






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






42. 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






43. Illiquidity - declining property values - lack of diversification - long depreciation period - management problems - syndicate investment is not a tax shelter






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






45. 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






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






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






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






49. 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






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







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