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






2. 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)






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






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






5. Buying a stock at a price you set






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






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. Securities market where dealers buy and sell securities for their own inventories; NASDAQ is one example






9. A market characterized by falling prices for securities






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






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. 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.






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






14. Price/earnings






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






16. Buying a stock at a price you set






17. A market characterized by falling prices for securities






18. Stock from nationally recognized companies which dominate the industry often having annual revenue of one billion or more






19. Equity financing for nonpublic companies






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






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






22. 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






23. When issuer sells the entire issue to the underwriters






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






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






26. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






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






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






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






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






31. A market characterized by rising prices for securities






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






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






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






35. New York Stock Exchange






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






37. Equity financing for nonpublic companies






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






39. Securities market where dealers buy and sell securities for their own inventories; NASDAQ is one example






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






41. 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






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






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






44. When issuer sells the entire issue to the underwriters






45. 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.






46. American Stock Exchange






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






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






49. 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






50. Stock from nationally recognized companies which dominate the industry often having annual revenue of one billion or more