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






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






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






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






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






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






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






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






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






10. Securities initially offered only to existing owners






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






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






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






14. Also known as secondary and follow-on offering






15. 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






16. Price/earnings






17. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






18. A market characterized by falling prices for securities






19. 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






20. Price/earnings






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






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






24. 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.






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






26. A market characterized by rising prices for securities






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






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






29. 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.






30. New York Stock Exchange






31. A market characterized by rising prices for securities






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






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






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






35. Equity financing for nonpublic companies






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






37. New York Stock Exchange






38. Financing for new - often high-risk ventures






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






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






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






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






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






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






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






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






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






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






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






50. Also known as secondary and follow-on offering