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






2. New York Stock Exchange






3. American Stock Exchange






4. 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)






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






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






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






8. Price/earnings






9. Price/earnings






10. An increase in price or value of a stock






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






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






13. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






14. Equity financing for nonpublic companies






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






16. 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






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






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






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






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






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






22. A market characterized by rising prices for securities






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






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






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






26. 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






27. 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.






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






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






30. Also known as secondary and follow-on offering






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






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






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






34. Buying a stock at a price you set






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






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






37. When issuer sells the entire issue to the underwriters






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






39. 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






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






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






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






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






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






45. Securities initially offered only to existing owners






46. A market characterized by rising prices for securities






47. American Stock Exchange






48. An increase in price or value of a stock






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






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