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. Price/earnings






2. Buying a stock at a price you set






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






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






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






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






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






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






9. American Stock Exchange






10. 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






11. 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






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






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






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






15. Also known as secondary and follow-on offering






16. 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






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






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






19. 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.






20. Buying a stock at a price you set






21. Securities initially offered only to existing owners






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






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






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






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






26. A market characterized by falling prices for securities






27. Also known as secondary and follow-on offering






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






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






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






31. Amount that you invest in securities






32. 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






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






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






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






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






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






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






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






40. Equity financing for nonpublic companies






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






42. New York Stock Exchange






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






44. American Stock Exchange






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






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






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






48. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






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






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