Test your basic knowledge |

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






2. Also known as secondary and follow-on offering






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






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






5. For efficient trading - not used in 1. less liquid stocks 2. during the opening and close of trading sessions 3. during times of market duress






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






7. 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






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






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






10. Price/earnings






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






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






13. Equity financing for nonpublic companies






14. Also known as secondary and follow-on offering






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






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






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






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






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






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






21. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






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






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






24. A market characterized by rising prices for securities






25. Order to sell shares if the stock price falls to a specified stop price above the current stock price; also called stop-loss b/c it is usually intended to limit losses on a long position






26. An increase in price or value of a stock






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






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






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






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. Securities initially offered only to existing owners






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






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






34. American Stock Exchange






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






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






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






38. New York Stock Exchange






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






40. 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)






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






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






43. 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






44. Price/earnings






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






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






47. American Stock Exchange






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






49. For efficient trading - not used in 1. less liquid stocks 2. during the opening and close of trading sessions 3. during times of market duress






50. New York Stock Exchange