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






2. An increase in price or value of a stock






3. Securities initially offered only to existing owners






4. Underwriter doesn't guarantee any particular amount of money to the issuer






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






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






7. Financing for new - often high-risk ventures






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






9. The person(s) resposible for implementing a fund's investing strategy and managing its portfolio trading activities






10. 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)






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






12. Amount that you invest in securities






13. Buying a stock at a price you set






14. The person(s) resposible for implementing a fund's investing strategy and managing its portfolio trading activities






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






16. NASDAQ is a computer network with no physical location and has a multiple market maker system rather than a specialist system






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






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






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






20. Equity financing for nonpublic companies






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






22. American Stock Exchange






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






24. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






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






26. Trading that occurs off the exchange on which the security is listed and fourth market is the direct trading of exchange-listed securities maong investors






27. Securities or SEO offered to the public on a first-come first serve basis






28. A measure of stock market prices based on thirty leading companies of the new york stock exchange and nasdaq






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






30. Securities or SEO offered to the public on a first-come first serve basis






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






32. A market characterized by rising prices for securities






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






34. A market characterized by falling prices for securities






35. Equity financing for nonpublic companies






36. Financing for new - often high-risk ventures






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






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






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






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






41. NASDAQ was opened to his which is a website that allowed investors to trade directly with one another;






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






43. Buying a stock at a price you set






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






45. An order to a broker to sell or buy stocks or commodities at the prevailing market price






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






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






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






49. 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.






50. Securities initially offered only to existing owners






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