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






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






3. 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






4. A market characterized by falling prices for securities






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






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






7. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






8. Price/earnings






9. American Stock Exchange






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






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






13. 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.






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






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






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






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






18. American Stock Exchange






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






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






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






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






23. Buying a stock at a price you set






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






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






26. Price/earnings






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






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






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






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






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






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






33. Financing for new - often high-risk ventures






34. An increase in price or value of a stock






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






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






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






38. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






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






40. Also known as secondary and follow-on offering






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






42. 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)






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






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






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






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






47. 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






48. New York Stock Exchange






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






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