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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. Price/earnings






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






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






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






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






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






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






8. 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.






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






10. 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)






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






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






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






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






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






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






17. A market characterized by falling prices for securities






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






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






20. Equity financing for nonpublic companies






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 corporation's first offer to sell stock to the public






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






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






25. 1directly with other investors - indirectly through a broker who arranges transactions with others - directly with a dealer who buys and sells securities from inventory






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






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






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






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






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






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






32. 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






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






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






35. 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






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






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






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






39. Securities initially offered only to existing owners






40. 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






41. An increase in price or value of a stock






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






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






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






45. When issuer sells the entire issue to the underwriters






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






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






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






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






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







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