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






2. Securities initially offered only to existing owners






3. Equity financing for nonpublic companies






4. Amount that you invest in securities






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






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






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






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






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






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






11. An increase in price or value of a stock






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






13. 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






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






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






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






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






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






19. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






20. 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






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






22. Price/earnings






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






24. A market characterized by falling prices for securities






25. Amount that you invest in securities






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






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






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






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






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






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






32. An increase in price or value of a stock






33. American Stock Exchange






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






35. When issuer sells the entire issue to the underwriters






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






37. American Stock Exchange






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






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






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






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






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






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






45. Also known as secondary and follow-on offering






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






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






48. Financing for new - often high-risk ventures






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






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