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






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






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






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






5. Equity financing for nonpublic companies






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






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






8. When issuer sells the entire issue to the underwriters






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






10. 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






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






12. Amount that you invest in securities






13. A market characterized by rising prices for securities






14. 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)






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






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






17. Price/earnings






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






19. A market characterized by falling prices for securities






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






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






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






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






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






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






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






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






28. 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






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






30. Securities initially offered only to existing owners






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






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






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






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






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






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






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






38. Financing for new - often high-risk ventures






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






40. Also known as secondary and follow-on offering






41. Securities initially offered only to existing owners






42. Price/earnings






43. Buying a stock at a price you set






44. A market characterized by rising prices for securities






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






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






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






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






49. 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






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







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