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1. The pillar principle you should always observe when investing is:
“don’t put all your eggs in one basket”
"always trust your instincts"
"do it fast and clean"
2. Relationship between the rate of inflation and the prices of commodities is
There is no relation
Strong
Weak
3. Which of the following is not Industrial Metals
Copper
Nickek
Platinum
Lead
4. Central banks can also directly increase the money supply by:
open new banks
lower the interests
printing money
5. What is Interest Rate Risk
This type of risk is associated with our opportunity to sell, or “liquidate” our investment
The probability that changes in the value of foreign currency would affect the return on the investment
The base interest rate of central banks, which serves as a benchmark for all interest rates in the economy
6. Exchange Rate Risk
The probability that changes in the value of foreign currency would affect the return on the investment
This is the type of risk that is not related to any external (exogenous) factors.
This type of risk is associated with our opportunity to sell, or “liquidate” our investment
7. Traditional investments are:
Stocks, Bonds, Mutual Funds, Money Markets
Stocks and Bonds
Real Estate, Commodities, Private Equity, Managed Futures
Stocks, Bonds, Commodities, Private Equity
8. Before making an investment, the most important and at the same time the most difficult thing is:
To obtain detailed information about the asset that you are about to invest in
To trade small volumes to validate the liquidity of the asset
To secure your investment by insurance policy
9. The secondary market is
where investors trade previously-issued securities without the involvement of the issuing-companies
where securities are created
10. The biggest financial hubs are
New York, London and Hong Kong
California, London and Hong Kong
New York, Berlin and Hong Kong
New York, Berlin and Moscow
11. Operating Cash Flow Ratio is equal to
(Current assets – Inventory)/Current Liabilities
Current assets/Current Liabilities
Cash Flow from operations/Current Liabilities
12. ROA – Return on Assets is equal to
Net income/Total assets
Total Revenue/Inventory
Net Income/Owner’s Equity
13. Change in the price of any financial instrument from one period to the next is called
Liquidity
Return
Risk
14. Benefits of mutual funds are
High return rate
Low-cost access to high-quality money managers
15. Quick Ratio is equal to
Cash Flow from operations/Current Liabilities
Current assets/Current Liabilities
(Current assets – Inventory)/Current Liabilities
16. Asset return volatility denotes the patterns and the magnitude by which
Risk fluctuate
Liquidity fluctuate
Returns fluctuate
17. What is the trend between point 4 and 5
Downtrends
Sideways/Horizontal Trends
Uptrends
18. If the market happens not to have many participants at that exact moment this condition is named
illiquidity
deflation
stagnation
19. Stocks that are reaching a lower price today than yesterday are called
rubbish issues
bad issues
declining issues
20. Chart that represents only the closing prices over a set period of time is
Point And Figure Chart
Bar chart
Line chart
21. If loss is 10% how much gain you need to recover?
11.1%
66.7%
25.0%
42.9%
22. If loss is 30% how much gain you need to recover?
11.1%
66.7%
42.9%
25.0%
23. If loss is 40% how much gain you need to recover?
66.7%
11.1%
25.0%
42.9%
24. If loss is 20% how much gain you need to recover?
66.7%
25.0%
42.9%
11.1%
25. The FX markets are the most liquid and highly traded markets in the world.
FALSE
TRUE
26. The most frequently occurring observation in a certain array of observations is
Median
Mode
Mean
27. When the body of candlestick is white, it means that the closing price was
lower than the opening price
higher than the opening price
28. We are able to measure productivity by
Shares Outstanding
Current Ratio
Asset Turnover
29. We are measuring increasing working capital by
Current Ratio
Asset Turnover
Shares Outstanding
30. What is not part of Candlesticks information matrix
Average
High
Sell or Buy
Low
31. Net Income + Amortization - Changes in Working Capital - Capital Expenditures =
P/E
Free Cash Flow
EBITDA
32. A mathematical equation whereby one variable – the dependent variable (e.g. it can be the movement of the price of an asset) is “explained”, or predicted, by one or more “independent” variables (e.g. inflation, consumption, interest rates etc.) is called
Correlation Analysis
Econometric regression
Standard Deviation Analysis
33. Most Futures contracts codes consist of
four characters
two characters
five characters
three characters
34. When picking your time to place trades there are four main factors that will always be important. Which one is not true?
When economic data is being released.
When key policy speakers are on the wires.
How are you feeling at that point in the day?
What is the volume of the order?
35. Key element in gold futures price is
Petrol price
Storage costs
Weather temperature
36. Entering a short position with an option is different than entering a short position with a stock
TRUE
FALSE
37. Derivative instrument whereby the two parties agree for a delivery of an underlying asset on a predefined settlement price at a future point in time is
Future promise
Save contract
Forward contracts
38. Momentum indicator that attempts to gauge whether an asset is overbought or oversold is
Relative strength index (RSI)
Price oscillator
Relative Momentum Index (RMI)
39. Strategy whereby a trader secures a limited profit potential and a limited loss potential by combining the positions of 4 option contracts.
Butterfly
Strangles
Straddle
40. To predicting the long-term pattern of asset prices is used
Advance decline ratio
Momentum indicator
Accumulative Swing Index (ASI)
41. Momentum traders are not sophisticated investors, they do not have the skills to interpret the fundamental information, so they are just technical traders without considering any fundamental information they just follow existing trends.
FALSE
TRUE
42. To understand finance market behavior, to shed light on the stock market anomalies is the role of behavioral finance theory
TRUE
FALSE
43. When you have a winning position, until you realize your profit, you have a strong psychological discomfort, due to fear of losing it. This forces you to act too quickly.
TRUE
FALSE
44. Male investors trade more aggressively than females, but they perform more poorly than females.
FALSE
TRUE
45. Which one is not major anomalies observed in financial markets
Reversals
Double liquidity
Short-term return continuation
Negative Autocorrelation
46. If you buy stocks, which now trade close to their 52-Week High, you will beat the market by 1% per month on the average.
TRUE
FALSE
47. Realized return minus expected return is the abnormal return and is unpredictable according to the Standard Finance Theory.
TRUE
FALSE
48. Which one is not anomaly according to Behavioral Bias
Disagreement of opinion has been found to decrease the trading volume.
Trading volume diminishes as the stock market is falling, because investors become less confident.
Trading volume is higher when the stock market is rising; that is when most investors are overconfident
The trading volume in financial markets is much higher than rational finance models predict.
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