Quiz 29 April

When were Ticker machines first used? Why?

1800s, as a faster way to transfer news long distances than a telegraph machine

How many companies are in the Dow-Jones industrial average?

30

Most advisors say you should have how many stocks in your portfolio?

30 stocks

The company APPLE has how many shares outstanding?

5.575 Billion$$$

What does a stock represent?

A percentage of ownership of a company including assets

What is a mutual fund?

A pool of securities you can buy as an investment

What is an Index ETF?

An ETF that tracks a stock index, like the S&P 500

Who would be the most likely to buy an inverse ETF?

An investor who normally is not able to short-sell in their portfolio

Who would be least likely to buy a leveraged ETF?

An investor who thinks the underlying index will slowly go up over time

General Electric (GE) was the longest-running member DJIA, from 1896 through 2018. What was the opening stock price on 31 December, 2014?

Between 151$ and 200$

What is the most common winning investment strategy for new beginners?

Buy what you know

What is the DJIA named after?

Charles Dow and his statistician Mr.Jones

Which of these is different between ETFs and Mutual Funds?

ETFs usually have lower fees than mutual funds

What does ETF stand for?

Exchange Traded Funds

What three questions should you consider when trying to invest?

Have they started to open new stores around me lately, or are they closing more shops? & Does there seem to always be a lot more of people you know using their products, or are they still more obscure? & Does their current news look positive or negative?

What should you look for when buying stock of a company you know?

If their stores always seem busy

Which is a characteristics of open-ended mutual funds?

Investors typically hold fractions of shares

How do you buy ETFs?

Like a stock, with the price constantly updating

What is one difference between Mutual Funds and ETFs?

Mutual Funds cannot be day-traded

What is a disadvantage of mutual funds?

Mutual funds can have maintenance fees regardless of fund performance

Two ways you can get a Net Stock

New Issues & Stock Dividends

Where did the traders in New York originally meet?

Outside near a buttonwood tree

What does it mean to Diversify?

Pick a variety of stocks in different industries

Where did stocks originate?

Rome

Types of diversification

Sector/industry and Stock diversification

How can you tell what professional stock analysts recommed?

SeekingAlpha.com, The Analysts page of the Quotes tool, and Searching for stock symbols on business websites

What is a Preferred stock?

Stock that gets paid its dividends first

What tools does the simulator have to help you choose stocks?

Suggested stock lists, current market news, and research tools with company info and quotes

What is the major focus of the NASDAQ index?

Technology companies

How can you find stock news about any company?

The Quotes Page

Define Bid Price

The highest price a buyer is willing to pay for the stock

Define Capital Preservation

The idea that you want to preserve the money you have invested

What was the biggest event leading to stocks being the most frequently traded security type on the exchange?

The industrial revolution

What does a stock quote represent?

The last price a seller and buyer agreed to make a trade

Define Ask Price

The lowest price a seller is willing to sell the stock

In the late 1800s, what factors led to the growth of the NYSE?

The needs for funds to finance new companies and build railroads

Why are stock indexes so important?

To help investors understand how the market as a whole is moving

What's an IPO?

When a company first sells shares to the public

Which is one major advantage of Mutual funds?

You have a fund manager so you do not need to constantly monitor your investments

Why do Companies have different classes of shares?

each class represents a different percentage of ownership of the company

What's a stock quote?

gives essential information about a particular stock at a point in time (normally includes name of the company, the ticker symbol, the price, the day's high and low prices, and the trading volume)

What's a common stock?

gives one vote at shareholder meetings for every share owned

Define Stock dividend

happens after IPO; Can be done by giving all current shareholders additional shares in proportion to how many shares they currently have

Why do people diversify?

helps to stabilise a portfolio's return and the more stock you earn the more likely you are to own a stock that end up doubling or tripling in price

Define "Asset Allocation"

owning a variety of investments like real estate, stocks, bonds, gold/silver, and cash

Why should you diversify your stocks?

so you can ensure that you always have a few stocks in each industry that will be a top performer, this way over time your portfolio returns are less volatile and always positive

What are the 3 asset classes

stocks, ETF, and mutual fund

Define ex-div date

the date the last paymount was based on

Why do companies like to stay in a parice range?

the more expensive the stock the less people that can buy it making splitting stocks more affordable and increase the total value of all stocks

Define Dividend Yield

the percentage of stock's price that is paid out in dividends per year

Define Net Change

the total amount a stock's price has changed since the previous trading day

Define Ticker Symbol

unique code for a company consisting of 1-5 letters

Define New Issue of Stock

when a private company decides to "Go Public", and issues shares of stock for anyone to buy; also called an Initial Public Offering (IPO)

Define "sector/industry diversification"

you would split your investments across companies based on the type of business they do