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






2. 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






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






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






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






6. Financing for new - often high-risk ventures






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






8. 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)






9. American Stock Exchange






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






11. Price/earnings






12. Amount that you invest in securities






13. New York Stock Exchange






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






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






16. An increase in price or value of a stock






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






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






19. A market characterized by rising prices for securities






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






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






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






23. 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






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






25. Equity financing for nonpublic companies






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






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






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






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






30. Price/earnings






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






32. 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






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






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






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






36. 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.






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






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






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






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






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






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






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






44. When issuer sells the entire issue to the underwriters






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






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






47. Financing for new - often high-risk ventures






48. When issuer sells the entire issue to the underwriters






49. Securities initially offered only to existing owners






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







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