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






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






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






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






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






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






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






8. Securities initially offered only to existing owners






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






10. New York Stock Exchange






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






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






14. Equity financing for nonpublic companies






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






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






17. New York Stock Exchange






18. 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)






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






20. Price/earnings






21. An increase in price or value of a stock






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






23. 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






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






25. A market characterized by rising prices for securities






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






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






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






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






30. Also known as secondary and follow-on offering






31. Securities initially offered only to existing owners






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






33. American Stock Exchange






34. Also known as secondary and follow-on offering






35. A market characterized by rising prices for securities






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






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






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






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






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






41. Financing for new - often high-risk ventures






42. Amount that you invest in securities






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






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






45. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






46. 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






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






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






49. 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)






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