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