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CSM Financial Management

  • Answer 50 questions in 15 minutes.
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  • 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. Cash dividends - price appearance - hedge against inflation - low minimum investment - limited liability - liquidity

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

3. 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

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

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

6. 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)

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

8. 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

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

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

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

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

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

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

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

16. 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

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

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

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

20. Not much risk is involved

21. 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

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

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

24. 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

25. 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

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

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

28. 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

29. Medium amount of risk is involved

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

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

32. Online research about listed companies

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

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

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

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

37. 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

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

39. A lot of risk is involved

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

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

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

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

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

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

46. Call feature - sinking fund - serial redemption

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

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

50. Securities exchanges - over the counter market