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Investing FAQs

  1. What was the most miserable day for financial markets according to the Misery Index?

  2. Does the balance sheet always balance?

  3. When did mutual funds come to the U.S.A.?

  4. The conduit theory...

  5. What is moral hazard?

  6. What is the difference between investing and speculating?

  7. Which statement(s) is/are FALSE about market risk?

  8. Under the Investment Company Act of 1940, an investment company must have minimum net assets of how much before it can issue shares to the public?

  9. Under the Investment Company Act of 1940, an investment company, or mutual fund company, must have minimum net assets of how much before it can issue shares to the public?

  10. What is the difference between yields and interest rates?

  11. What does churning mean?

  12. What is an absolute rate?

  13. What burst the Mississippi bubble?

  14. Can I still make money with a couch-potato portfolio?

  15. Is there short selling in China?

  16. When and why did the euro make its debut as a currency?

  17. Which statement is FALSE about a prospectus issued under the Securities Act of 1933?

  18. What is the performance cult?

  19. What's the difference between EBITDA, EBITDAR and EBITDARM?

  20. All of the following statements about convertible bonds are FALSE EXCEPT:

  21. An investor is in the 36% tax bracket and holds municipal bonds with an 8% yield-to-maturity. What is the equivalent taxable yield?

  22. Which day is known as China's "Black Tuesday" and why?

  23. Compute the offering price for a mutual fund with NAV of $1,200,000,000, an 8% front-end load, and 1,000,000 shares outstanding.

  24. What is the difference between a gilt edged bond and a regular bond?

  25. Why is Frank Quattrone credited with contributing to the growth of the dotcom bubble?

  26. What is financial double-dipping?

  27. What is the difference between exchange-traded funds and mutual funds?

  28. What currency is affected by the interest rate decisions of the Bank of England (BoE)?

  29. Which of the following BEST describes the requirements for advertisements of new municipal securities issues?

  30. How did Peter Young gain infamy as a "rogue trader"?

  31. How do companies like Moody's rate bonds?

  32. What is a Chinese hedge?

  33. What is "hot money"?

  34. How do I use a barbell strategy?

  35. How do I use a premium put convertible?

  36. How did derivatives trader Nick Leeson contribute to the fall of Barings Bank?

  37. What is a wild-card play?

  38. How did currency trader John Rusnak hide $691 million in losses before being caught for bank fraud?

  39. What's the difference between a mutual fund and a hedge fund?

  40. What are the advantages and disadvantages of buying stocks instead of bonds?

  41. What happens if I maintain a short position in a stock that is delisted and declares bankruptcy?

  42. Why can you short sell an ETF but not an index fund?

  43. What's the difference between absolute P/E ratio and relative P/E ratio?

  44. How can you lose more money than you invest shorting a stock? If you have no money left in your account, how do you pay it back?

  45. What is the difference between convertible and reverse convertible bonds?

  46. What does 'froth' mean in terms of the real estate market?

  47. Where does the stock come from when convertible bonds are converted to stock?

  48. Can a bond have a negative yield?

  49. Where do companies keep their cash?

  50. Are eurodollars related to the currency called the euro?

  51. Why does a crisis in emerging markets cause U.S. Treasury yields to decrease?

  52. Can an open-ended fund's price appreciate significantly?

  53. Are mortgage-backed securities backed by any guarantees?

  54. What is foreclosure investing?

  55. Why are P/E ratios generally higher during times of low inflation?

  56. How do you find out the price of a mutual fund?

  57. What's the difference between a stop and a limit order?

  58. A corporate bond I own has just been called by the issuer. How can a company legally take away my bond? How do these call provisions work?

  59. Why do you need a margin account to short sell stocks?

  60. Short selling vs. purchasing a put option: how do the payoffs differ?

  61. What are the components of the risk premium for investments?

  62. How many types of markets can an investor choose from?

  63. Why are big foreign companies considering delisting their American depositary receipts?

  64. Are ETFs subject to the short sale uptick rule?

  65. What does CHIPS UID mean?

  66. How do I avoid paying excess taxes on securities I have sold?

  67. Can I give stock as a gift?

  68. How do central banks inject money into the economy?

  69. Which of the following statements regarding the performance of a mutual fund would be permitted under current rules?

  70. Are long-term U.S. government bonds risk-free?

  71. Where can I find the P/E ratios for the Dow and S&P 500?

  72. What is mutual fund timing, and why is it so bad?

  73. Can a stock lose all its value? How would this affect a long or short position?

  74. I have discovered that a bond I am interested in has a sinking fund. What does this mean?

  75. What is the ideal number of stocks to have in a portfolio?

  76. What is a basis point (BPS)?

  77. I want to invest in equities, but I don't have much money. Is there a minimum number of shares I must buy?

  78. If different bond markets use different day-count conventions, how do I know which one is used in any particular market?

  79. Do noise traders have any long-term effect on stock prices?

  80. Why would a multinational corporation conduct a vertical foreign direct investment?

  81. I sold my house. Can I exclude the gain from my income?

  82. Can I donate stock to charity?

  83. How does a credit crunch occur?

  84. Calculate the total return of the municipal bond described below.

  85. When you buy a stock in a company, does it necessarily mean that one of the shareholders is selling it to you?

  86. What's the difference between absolute and relative return?

  87. Why are the bid prices of T-bills higher than the ask prices? Aren't bids supposed to be lower than ask prices?

  88. Why do interest rates tend to have an inverse relationship with bond prices?

  89. Do hedge funds and mutual funds invest in commodities in high inflation environments?

  90. Does the party loaning shares in a short sale transaction benefit in any way other than from the interest earned on the loan?

  91. My certificate of deposit (CD) has just matured and I plan to contribute $10,000 of it to my current Roth IRA account. The person doing my taxes can't tell me why I can't make such a large contribution except for my low income - I am a disabled veteran on

  92. Which is a better measure for capital budgeting, IRR or NPV?

  93. I am a non-U.S. citizen living outside the U.S. and trading stocks through a U.S. internet broker. Do I have to pay taxes on the money I earn?

  94. What is the difference between municipal bonds and standard money market funds?

  95. How do you calculate the cost basis for a mutual fund over an extended time period?

  96. Why do some preferred stocks have a higher yield than common stocks?

  97. How do I calculate the percentage gain or loss for my portfolio when all of the stocks have different prices?

  98. What are green investments?

  99. How do I open a Swiss bank account, and what makes them so special?

  100. Where can I buy government bonds?

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Last Questions Asked:
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    What is a triple tax-free municipal bond?

  2. How are capital gains and dividends taxed differently?

  3. How do you flip a home?

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