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Test your basic knowledge |
Investments
Start Test
Study First
Subject
:
personal-finance
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. Annual coupon divided by the current bond price
Commodity Futures
Call Money Rate
Margin Account
Current Yield
2. Or market cap for short is equal to its stock price multiplied by the number of shares of stock. It's the total value of the company's stock.
Derivative Asset
Turnover
Total Market Capitalization
Strike Price
3. A symmetric - bell-shaped frequency distribution that is completely defined by its average and standard deviation.
Financial Futures
Securities Investor Protection Corporation (SIPC)
Normal Distribution
Put Option
4. Buying and selling in anticipation of the overall direction of a market
Margin Call
Effective Annual Return (EAR)
Market Timing
Asset Allocation
5. Average compound rate of return earned per year over a multiyear period accounting for investment inflows and outflows
Fixed-Income Securities
Dollar-Weighted Average Return
Total Dollar Return
NYSE Uptick Rule
6. An agreement made today regarding the terms of a trade that will take place later.
Fixed-Income Securities
Cash Account
Futures Contract
Security Selection
7. The price you pay to buy an option
Option Premium
Market Timing
Call Money Rate
Option Contract
8. The return earned in an average year over a multiyear period
Cash Account
Derivative Asset
REIT
Arithmetic Average Return
9. The distribution of investment funds among broad classes of assets
Margin
Asset Allocation
Money Market Mutual Fund
Mutual Fund
10. The value of assets less liabilities held by a mutual fund - divided by the number of shares outstanding.
Short Interest
Risk-Free Rate
Net Asset Value
Standard Deviation
11. An investment company that stands ready to buy and sell shares at any time.
Capital Gains Yield
Open-End Fund
REIT
Arithmetic Average Return
12. A sales charge levied on purchases of shares in some mutual funds
Asset Allocation
Margin Account
Front-End Load
NYSE Uptick Rule
13. A brokerage account in which - subject to limits - securities can be bought an sold on credit
Commodity Futures
Capital Gains Yield
12b-1 Fees
Margin Account
14. An agreement that gives the owner the right - but not the obligation - to buy or sell a specific asset at a specified price for a set period of time.
Maintenance Margin
Hedge Fund
Fixed-Income Securities
Option Contract
15. An option that gives the owner the right - but not the obligation - to sell an asset
Geometric Average Return
Put Option
Strike Price
Short Sale
16. Named for SEC rule 12b-1 - which allows funds to spend up to 1 percent of fund assets annually to cover distribution and marketing costs
Securities Investor Protection Corporation (SIPC)
Net Asset Value
12b-1 Fees
Short Sale
17. The rate of return on a riskless investment
Strike Price
Derivative Asset
Risk-Free Rate
Total Market Capitalization
18. An option that gives the owner the right - but not the obligation - to buy an asset
Capital Gains Yield
Call Option
Security Selection
Turnover
19. Rule for short sale requiring that before a short sale can be executed - the last price change must be an uptick
CDSC
NYSE Uptick Rule
Mutual Fund
Effective Annual Return (EAR)
20. Selection of specific securities within a particular class
Total Dollar Return
Security Selection
Primary Asset
Short Sale
21. The square root of the variance
Money Market Instuments
Put Option
Standard Deviation
Closed-End Fund
22. Debt obligations of large corporations and governments with an original maturity of one year or less
Arithmetic Average Return
Financial Futures
Money Market Instuments
Futures Contract
23. Pledging securities as collateral against a loan
Arithmetic Average Return
Hypothecation
Open-End Fund
Margin Account
24. The minimum margin that must be present at all times in a margin account
Cash Account
Short Interest
Hypothecation
Maintenance Margin
25. Longer-term debt obligations - often of corporations and governments - that promise to make fixed payments according to a preset schedule.
Asset Allocation
Fixed-Income Securities
Hedge Fund
Turnover
26. The return on an investment measured as a percentage that accounts for all cash flows and capital gains or losses
REIT
Option Contract
Total Percent Return
Securities Investor Protection Corporation (SIPC)
27. Simply a means of combining or pooling the funds of a large group of investors. The buy and sell decisions for the resulting pool are then made by a fund manager - who is compensated for the service provided.
Risk-Free Rate
Asset Allocation
Mutual Fund
Cash Account
28. The portion of the value of an investment that is not borrowed
Margin
Call Money Rate
Risk-Free Rate
Short Sale
29. A brokerage account in which all transactions are made on a strictly cash basis
NYSE Uptick Rule
Variance
REIT
Cash Account
30. A measure of how much trading a fund does - calculated as the lesser of total purchases or sales during a year divided by average daily assets
Turnover
12b-1 Fees
Call Option
Capital Gains Yield
31. An investment company with a fixed number of shares that are bought and sold only in the open stock market.
Closed-End Fund
Call Option
Hypothecation
Front-End Load
32. A demand for more funds that occurs when the margin in an account drops below the maintenance margin
Total Percent Return
Margin Call
Dividend Yield
Money Market Mutual Fund
33. The return on an investment measured in dollars that accounts for all cash flows and capital gains or losses
Primary Asset
Total Dollar Return
Margin
Hypothecation
34. Underlying asset is intangible - usually stocks - bonds - currencies - or money market instruments.
Total Market Capitalization
Securities Investor Protection Corporation (SIPC)
Financial Futures
Closed-End Fund
35. A sales charge levied when investors redeem shares (also called a 'back-end' load).
CDSC
Maintenance Margin
Net Asset Value
Call Option
36. The minimum margin that must be supplied on a securities purchase
Initial Margin
NYSE Uptick Rule
Geometric Average Return
Open-End Fund
37. Underlying asset is a real asset - typically either an agricultural product or a natural resource product
Commodity Futures
Option Contract
NYSE Uptick Rule
Put Option
38. Security originally sold by a business or government to raise money
Money Market Mutual Fund
NYSE Uptick Rule
Primary Asset
Current Yield
39. An arrangement under which a broker is the registered owner of a security
Front-End Load
Total Dollar Return
Street Name
Money Market Instuments
40. The interest rate brokers pay to borrow bank funds for lending to customer margin accounts
Option Contract
Closed-End Fund
Call Money Rate
Short Sale
41. The amount of common stock held in short positions
Geometric Average Return
Securities Investor Protection Corporation (SIPC)
Short Interest
Futures Contract
42. A sale in which the seller does not actually own the security that is sold
Derivative Asset
Short Sale
Money Market Mutual Fund
Hypothecation
43. A common measure of volatility
Primary Asset
Variance
Margin Call
Street Name
44. Insurance fund convering investors' brokerage accounts with member firms
Hypothecation
Securities Investor Protection Corporation (SIPC)
Initial Margin
Short Sale
45. The extra return on a risky asset over the risk-free rate; the reward for bearing risk.
Risk Premium
Open-End Fund
Short Sale
Geometric Average Return
46. The price specified in an option contract at which the underlying asset can be bought (for a call option) or sold (for a put option). Also called the striking price or exercise price.
Hypothecation
Net Asset Value
Turnover
Strike Price
47. The change in stock price as a percentage of the initial stock price.
Capital Gains Yield
Variance
Margin
Securities Investor Protection Corporation (SIPC)
48. The average compound return earned per year over a multiyear period.
Geometric Average Return
Call Option
Net Asset Value
Commodity Futures
49. An investment company not accessible by the general public
REIT
Primary Asset
Risk-Free Rate
Hedge Fund
50. A mutual fund specializing in money market instruments
Money Market Mutual Fund
Cash Account
12b-1 Fees
Net Asset Value