What are municipal bonds?

Bonds issued by state and local governments

How do bond ratings work?

The higher the bond rating, the lower the interest rate

What is a mutual fund?

A pool of money used to buy a variety of stocks and bonds

The ability to turn your money into cash or spendable funds

What is a stock dividend?

Part of a company's profit that is paid to owners

An order to buy or sell a stock at the market means to buy or sell the stock

at whatever price is currently set by the market

What is the relationship between the expected rate of return and the investment risk?

Greater the risk, the greater the expected rate of return

Part ownership of a corporation

One way people can earn money from stocks is by

selling the stock for a higher price than price they paid

A certificate representing a loan to a corporation or gov't

Generally speaking, what does the term "asset allocation" in an investment account mean?

The proportion of stocks and bonds or other assets in a portfolio.

What are stock markets?

Places or ways in which people buy and sell stocks

What is an advantage of buying a mutual fund?

Allow investors to spread risk among several stocks and bond

Issued by local governments to raise money for roads, bridges, etc.

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Stocks, Bonds, and Mutual Funds

36 termsStudBud Administration57 plays

#Stock Market #Finance #Stocks #Bonds #Mutual Funds

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Questions 36

Answers

1
Which of the following would be a good source to find Bond ratings?
Dow Jones
Moody's
S&P 500
All of the above
2
What are municipal bonds?
Unsafe bonds that governments avoid
Bonds issued by consumers
Bonds issued by state and local governments
Unsafe bonds that consumers avoid
3
How do bond ratings work?
The higher the bond rating, the lower the interest rate
The lower the bond rating, the higher the interest rate
The higher the bond rating, the higher the interest rate
The lower the bond rating, the lower the interest rate
4
What is a mutual fund?
A group of investors used to buy equity in various companies
An angel investor who pools money to invest in a start-up
A pool of money used to buy a variety of stocks and bonds
A single investor who buy a variety of stocks and bonds
5
Which is the largest stock market in terms of stocks traded?
AMEX
NYSE
NASDAQ
6
...is like a ruler, it's a way of measuring the performance or movement, of stocks and bonds.
Small Cap
Index
A sector
Large Cap
7
Which is the oldest stock market?
NASDAQ
AMEX
NYSE
8
What is liquidity?
The ability to turn your money into cash or spendable funds
The ability to "wash" your money so its untraceable
The wetness of the money in your pocket
The flow of assets
9
What is a stock dividend?
The price for which the stock is sold to investment bankers
The price for which the stock is sold in stock markets
Part of a company's profit that is paid to owners
A capital gain
10
You are looking for an investment that combines stocks and bonds, you would likely choose....
Mutual Funds
Corporate Bonds
Real Estate
Government Bonds
11
An order to buy or sell a stock at the market means to buy or sell the stock
at an organized financial market, such as the NYSE
as long as the price does not exceed a certain limit
at whatever price is currently set by the market
in the over-the-counter market
12
What is the relationship between the expected rate of return and the investment risk?
Lower the risk, the greater the expected rate of return
There is no relation ship between risk and rate of return
Greater the risk, the lower the expected rate of return
Greater the risk, the greater the expected rate of return
13
What is a stock?
Part of a corporation's profit
Part ownership of a corporation
Money you receive from a corporation
Above average returns on an investment
14
Why do people buy stocks?
The government encourages them to buy stock
There is no chance of loss
They are guaranteed interest payments each year
They expect to earn money
15
Which stock market is considered "home of the tech stock"?
NYSE
AMEX
NASDAQ
16
An investment management company that pools the money of investors.
Mutual Fund
Exchange Traded Funds
Municipal bonds
Roth IRA
17
Which investment is backed by the government?
Which investment is backed by the government?
Treasury Bond
Annuity
Mutual Fund
18
My investment portfolio should . . .
be diversified.
liquidate my assets.
reflect brand names of product sectors
show healthy risk.
19
One way people can earn money from stocks is by
selling the stock for a higher price than price they paid
selling the stock for a lower price as the price they paid
buying stock from an investment banker
selling the stock for the same price as the price they paid
20
Which stock market has no physical location and trades are done via computer networks?
NYSE
NASDAQ
AMEX
21
What is a bond?
A certificate of deposit
A certificate of ownership with a percentage of the earnings
A certificate representing a loan to a corporation or gov't
A group of stocks sold together for a set price
22
Bonds are a riskier investment than stocks
False
True
23
Buying and selling stocks and bonds is referred to as...
negotiating
consensing
bartering
trading
24
Which of the following mortgage bond ratings could produce the greatest yield for an investor?
A
BBB
B
AAA
25
Why is diversification a good investment strategy?
Increases investors' access to money
reduces risks to investors
guarantees a fixed rate of return on investments
offsets the effects of inflation on investments
26
Generally speaking, what does the term "asset allocation" in an investment account mean?
The proportion of stocks and bonds or other assets in a portfolio.
Whether you put your investments in a TFSA or RRSP or taxable account.
Who your account goes to when you die.
How often you contribute to the account.
27
Standard and Poor and Moodys issue ratings to indicate the bond's
return
risk
coupon rate
28
What are stock markets?
Places or ways in which people buy and sell stocks
Upscale boutiques selling and buying stocks
New York City discount stores
Stores in the mall specializing in stocks
29
What does a full-service broker do that a discount broker does not do?
Makes transactions in the over-the-counter market
Gives investment advice
Makes transactions in organized financial markets
Charges a commission
30
People buy stocks because?
they are guaranteed interest payments each year
there is no chance of a loss
they expect to earn a profit
the government encourages them to buy stock
31
What is an advantage of buying a mutual fund?
Load funds do not charge a sales commission
Allow investors to spread risk among several stocks and bond
Many mutual funds do not charge management fees
All mutual funds are the same
32
Which stock market is home to the Dow Jones and S&P 500?
NASDAQ
AMEX
NYSE
33
The chances of losing part of all of your investment is called_____.
margin
trade
impossible
risk
34
Municipal bonds are:
Are highly speculative (high risk)
Issued by corporations to expand thier business
Issued by the Federal Government to raise funds for entitilement programs
Issued by local governments to raise money for roads, bridges, etc.
35
A bond's interest rate is called its
par value
principal
face value
coupon rate
36
A company with a stock market cap of less than $1 bill. These stocks tend to grow faster but can be a riskier investment
Dividend
Large cap
Small Cap
Mid Cap

Stocks, Bonds, and Mutual Funds Flashcards | StudBud