Exam 12: Securities Markets

Specialists maintain a fair and orderly market by buying and selling stock from their inventory to keep the market from fluctuating more than it would otherwise.

The NASDAQ is the largest electronic stock exchange.

A ________ is a trading order that expires at the end of the trading day during which it was made.

A prospectus is an advertisement placed in a newspaper or magazine that provides a listing of the underwriting syndicate involved in the new offering, in addition to basic information on the offering.

Describe the typical order characteristics you will encounter.

Securities that are less frequently traded, along with many new and high-tech stocks, are relegated to the

Investment advice is very difficult to find and expensive to purchase.

Securities are generally sold in the primary markets with the help of a(n) ________ serving as a(n) ________.

A(n) ________ advertisement provides a listing of the underwriting syndicate involved in a new offering.

Full service brokers are legally obligated to analyze the recommendations they receive from analysts.

When placing a market order to purchase shares of stock, you will be required to make the order good-till-canceled.

With short selling you are hoping for the stock price to fall.

The Insider Trading Sanctions Act of 1984 and the Insider Trading and Securities Fraud Enforcement Act of 1988 made it illegal to trade while in the possession of inside information, or "material" non-public information held by

Investors with ________ accounts pay in full for their security purchases.

American Depository Receipts are receipts given by American banks for deposits in foreign countries.

When trading there are "round trip" costs in that you will pay costs when you buy securities and when you sell securities.

You purchased some stock last month for $50 per share. Today the stock closed at $80 per share. You would like to protect the profit that you have made on this stock but you really don't want to sell it in case it continues to rise in price. What should you do?

Stocks are initially sold in the primary markets with the help of an investment banker serving as the underwriter.

If you purchases securities jointly with another person, how the account is registered is not very important.

Name the major organizations regulating the stock market and tell why they came about.