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






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






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






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






5. Medium amount of risk is involved






6. A lot of risk is involved






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






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






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






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






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






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






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






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






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






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






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






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






19. 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






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






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






22. Initial public offerings - investment banks






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






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






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






26. 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






27. 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






28. 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






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






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






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






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






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






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






35. Online research about listed companies






36. Call feature - sinking fund - serial redemption






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






38. 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






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






40. 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)






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






42. Fundamental analysis - technical analysis - efficient market theory






43. 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






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






45. 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






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






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






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






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






50. Securities exchanges - over the counter market