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. 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)






2. 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






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






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






5. 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






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






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






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






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






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






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






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






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






14. Fundamental analysis - technical analysis - efficient market theory






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






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






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






18. 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






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






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






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






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






23. 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






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






25. Online research about listed companies






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






27. 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






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






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






30. Medium amount of risk is involved






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






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






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






34. 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






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






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






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






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






39. 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






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






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






42. Securities exchanges - over the counter market






43. Call feature - sinking fund - serial redemption






44. 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






45. 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






46. 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






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






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






49. 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






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