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Stock Market Basics

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. Also known as uniform price auction b/c all successful bidders pay the same price






2. Securities market where dealers buy and sell securities for their own inventories; NASDAQ is one example






3. A certificate of debt (usually interest-bearing or discounted) that is issued by a government or corporation in order to raise money






4. Mutual fund in which shares are sold without a commission or sales charge






5. Buys & sells for clients at a reduced commission. They offer little or no investment advice.






6. An order to a broker to sell (buy) when the price of a security falls (rises) to a designated level






7. A person who buys or sells stocks for another in exchange for a commission






8. A list of the financial assets held by an individual or a bank or other financial institution






9. Fund that pools the savings of many individuals and invests this money in a variety of stocks - bonds - and other financial assets






10. Also known as uniform price auction b/c all successful bidders pay the same price






11. A division of shares of a company into a larger number of shares. (A 2 for 1 allows a shareholder to double the number of shares but worth one half of their previous value - like trading a $10 for 2 $5's)






12. American Stock Exchange






13. A person who buys or sells stocks for another in exchange for a commission






14. An order to a broker to sell (buy) when the price of a security falls (rises) to a designated level






15. A division of shares of a company into a larger number of shares. (A 2 for 1 allows a shareholder to double the number of shares but worth one half of their previous value - like trading a $10 for 2 $5's)






16. A stock selling for less that $1/share; usually high risk






17. Also known as secondary and follow-on offering






18. Equity financing for nonpublic companies






19. When issuer sells the entire issue to the underwriters






20. A corporation's first offer to sell stock to the public






21. Difference between closing price of previous day and current day






22. All of the investments - including stocks - bonds - mutual funds - options - and commodities - that are traded






23. Buys & sells for clients at a reduced commission. They offer little or no investment advice.






24. Bid- price dealer is willing to pay - ask- price dealer will sell at






25. That part of the earnings of a corporation that is distributed to its shareholders






26. Stop order is where the customer specifies a stop price in which once it's reached - it is converted into a market order






27. The system that prints or dsplays last sale prices and the volume of securities transactions on exchanges on a moving tape






28. A computerized data system to provide brokers with price quotations for securities traded over the counter






29. Once the stock price reaches the preset stop price the order is converted ito a limit order






30. 1. at least 2200 shareholders and average monthly trading volume for the most recent six months must be at least 100000 shares 2. at least 1.1 million stocks shares in public hands 3. must be at $100 million in market value ($60 million for IPOS) 4.






31. The most basic form of ownership - including voting rights on major issues - in a company






32. The market in which securities that are not listed on exchanges are traded






33. Another name for IPO - b/c shares are not available to the public before the IPO






34. Stock whose holders are guaranteed priority in the payment of dividends but whose holders have no voting rights






35. A market characterized by falling prices for securities






36. A certificate of debt (usually interest-bearing or discounted) that is issued by a government or corporation in order to raise money






37. A preliminary prospectus among investor to generate interest in the stock offering






38. Fund that pools the savings of many individuals and invests this money in a variety of stocks - bonds - and other financial assets






39. Financing for new - often high-risk ventures






40. A list of the financial assets held by an individual or a bank or other financial institution






41. Dealer- has inventory like car dealer - broker- brings buyers and sellers together (like real estate broker)






42. The system that prints or dsplays last sale prices and the volume of securities transactions on exchanges on a moving tape






43. Detailed acct of company's financial position - its operations - and its investment plans for the future which is submitted to SEC for approval






44. A group of underwriters formed to share the risk and to help sell an issue






45. Securities initially offered only to existing owners






46. All of the investments - including stocks - bonds - mutual funds - options - and commodities - that are traded






47. A certificate documenting the shareholder's ownership in the corporation. There is no guarantee of making money with a stock.






48. Stock from nationally recognized companies which dominate the industry often having annual revenue of one billion or more






49. Securities initially offered only to existing owners






50. 1. at least 2200 shareholders and average monthly trading volume for the most recent six months must be at least 100000 shares 2. at least 1.1 million stocks shares in public hands 3. must be at $100 million in market value ($60 million for IPOS) 4.