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. Buying a stock at a price you set






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






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






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






5. A market characterized by falling prices for securities






6. When issuer sells the entire issue to the underwriters






7. Financing for new - often high-risk ventures






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






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






10. 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)






11. Price/earnings






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






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






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






15. Securities initially offered only to existing owners






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






17. New York Stock Exchange






18. An increase in price or value of a stock






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






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






21. 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






22. New York Stock Exchange






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






24. Financing for new - often high-risk ventures






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






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






27. A market characterized by rising prices for securities






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






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






30. 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)






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






32. When issuer sells the entire issue to the underwriters






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






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






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






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






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






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






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






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






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






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






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






44. Price/earnings






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






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






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






48. American Stock Exchange






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






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