Markets, crashes, and investing history.
Test your knowledge with these top questions!
What is the profit on a stock sold above its purchase price called?
A capital gain is realized when an investment is sold for more than the investor paid for it.
Which company measure sets a stock's weight in the standard S&P 500?
Float adjustment excludes large blocks of shares that public investors cannot readily trade.
Which order usually applies when a bankrupt corporation distributes liquidation proceeds?
Debt claims come before equity, and preferred shares rank ahead of common shares in liquidation.
Unlike a dividend, a share buyback sends company cash directly to which investors?
A buyback pays sellers who tender or sell shares; remaining holders receive no direct cash payment.
If net income stays fixed while a buyback lowers shares outstanding, what happens to basic EPS?
Basic EPS divides net income by weighted-average common shares, so a smaller denominator raises the result.
Which statistic measures how widely investment returns vary around their average?
A higher standard deviation means returns have varied more widely, so it is often used to measure volatility.
Which measure combines an investment's change in value with its interest or dividends?
Total return adds an investment's price change to the interest or dividends collected while it was held.
Which market launched in 1971 as the first electronic stock market?
Nasdaq connected competing market makers electronically instead of gathering them on a physical trading floor.
What job does an electronic communication network, or ECN, perform?
The SEC defines an ECN as a system that automatically matches buy and sell orders at specified prices.
Which benchmark do news reports mean by "the Dow"?
The Dow follows a selected group of large U.S. companies and weights them by share price.