Test your basic knowledge |

Investments

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. Debt obligations of large corporations and governments with an original maturity of one year or less






2. A financial asset that is derived from an existing traded asset rather than issued by a business or government to raise capital. More generally - any financial asset that is not a primary asset.






3. The return on an investment measured as a percentage that accounts for all cash flows and capital gains or losses






4. The return earned in an average year over a multiyear period






5. A brokerage account in which all transactions are made on a strictly cash basis






6. A sales charge levied when investors redeem shares (also called a 'back-end' load).






7. The average compound return earned per year over a multiyear period.






8. The minimum margin that must be supplied on a securities purchase






9. An investment company with a fixed number of shares that are bought and sold only in the open stock market.






10. The change in stock price as a percentage of the initial stock price.






11. An agreement made today regarding the terms of a trade that will take place later.






12. The amount of common stock held in short positions






13. The value of assets less liabilities held by a mutual fund - divided by the number of shares outstanding.






14. Underlying asset is intangible - usually stocks - bonds - currencies - or money market instruments.






15. A brokerage account in which - subject to limits - securities can be bought an sold on credit






16. Rule for short sale requiring that before a short sale can be executed - the last price change must be an uptick






17. The price you pay to buy an option






18. The interest rate brokers pay to borrow bank funds for lending to customer margin accounts






19. The annual stock dividend as a percentage of the initial stock price






20. A sale in which the seller does not actually own the security that is sold






21. Insurance fund convering investors' brokerage accounts with member firms






22. A common measure of volatility






23. 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.






24. 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






25. Buying and selling in anticipation of the overall direction of a market






26. The distribution of investment funds among broad classes of assets






27. The minimum margin that must be present at all times in a margin account






28. An option that gives the owner the right - but not the obligation - to buy an asset






29. Longer-term debt obligations - often of corporations and governments - that promise to make fixed payments according to a preset schedule.






30. A symmetric - bell-shaped frequency distribution that is completely defined by its average and standard deviation.






31. The return on an investment expressed on a per-year - or 'annualized -' basis






32. An investment company that stands ready to buy and sell shares at any time.






33. 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






34. Pledging securities as collateral against a loan






35. The rate of return on a riskless investment






36. The extra return on a risky asset over the risk-free rate; the reward for bearing risk.






37. An investment company not accessible by the general public






38. Underlying asset is a real asset - typically either an agricultural product or a natural resource product






39. A company that owns income producing real estate






40. An option that gives the owner the right - but not the obligation - to sell an asset






41. A sales charge levied on purchases of shares in some mutual funds






42. A demand for more funds that occurs when the margin in an account drops below the maintenance margin






43. The portion of the value of an investment that is not borrowed






44. An arrangement under which a broker is the registered owner of a security






45. The return on an investment measured in dollars that accounts for all cash flows and capital gains or losses






46. 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.






47. A mutual fund specializing in money market instruments






48. Annual coupon divided by the current bond price






49. Average compound rate of return earned per year over a multiyear period accounting for investment inflows and outflows






50. Selection of specific securities within a particular class