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Investing FAQs

  1.

    All of the following are regulated by the Investment Companies Act of 1940 EXCEPT

  2. What are the benefits of credit ratings?

  3. What does it mean when futures prices are in contango?

  4. Do speculators have a destabilizing effect on the financial system?

  5. What is an unregistered mutual fund?

  6. What is a permanent portfolio?

  7. Why aren't economists rich?

  8. What is high-frequency trading?

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

  10. Is it possible to short sell real estate?

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

  12. Does the balance sheet always balance?

  13. Which of the following BEST describes a wash sale?

  14. The conduit theory...

  15. What is moral hazard?

  16. What is the difference between investing and speculating?

  17. 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?

  18. 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?

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

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

  21. What does churning mean?

  22. What is an absolute rate?

  23. What was the first company with a $1 billion market cap?

  24. Why should I invest in the market when I can buy and sell houses or cars?

  25. What burst the Mississippi bubble?

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

  27. Is there short selling in China?

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

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

  30. When did the U.S. start using paper money?

  31. What is the performance cult?

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

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

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

  35. How do I know if I am buying unregistered securities or stocks?

  36. Why does the IRS withhold income taxes from employee paychecks?

  37. What are unregistered securities or stocks?

  38. 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.

  39. When is it a good idea to take out a loan to invest?

  40. What is financial double-dipping?

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

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

  43. What is the difference between return on equity and return on capital?

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

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

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

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

  48. What is a Chinese hedge?

  49. What is "hot money"?

  50. How did Joseph Jett cause Kidder, Peabody & Co. to lose over $350 million?

  51. How do I use a barbell strategy?

  52. How do I use a premium put convertible?

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

  54. What was the first company to issue stock?

  55. What is a wild-card play?

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

  57. What is the difference between term and universal life insurance?

  58. Do I receive the posted dividend yield every quarter?

  59. What's the difference between "top-down" and "bottom-up" investing?

  60. What is earnings management?

  61. What is market capitulation?

  62. What does it mean when a bond is selling at a premium? Is it a good investment?

  63. What does "in street name" mean, and why are securities held this way?

  64. What does investment grade mean?

  65. What is the difference between preferred stock and common stock?

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

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

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

  69. Where can I buy government bonds?

  70. Can you short sell ETFs?

  71. What's the difference between publicly- and privately-held companies?

  72. What's the difference between bills, notes and bonds?

  73. Why should I invest?

  74. Who's in charge of managing exchange-traded funds?

  75. What is inflation and how should it affect my investing?

  76. Why do some closed-end mutual funds trade above or below their net asset values?

  77. What's the difference between shares and stocks?

  78. Why don't investors buy stock just before the dividend date and sell right afterwards?

  79. What is the incentive to buy a stock without dividends?

  80. What is accrued interest, and why do I have to pay it when I buy a bond?

  81. What does a cut in interest rates mean for the stock market?

  82. What is the difference between fundamental and technical analysis?

  83. Where did the bull and bear market get their names?

  84. What is a stripped bond?

  85. How are the interest charges calculated on my margin account?

  86. What's the difference between a load and no-load mutual fund?

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

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

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

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

  91. How rapidly can expanding sales reduce a firm's earnings?

  92. I'm about to retire. If I pay off my mortgage with after-tax money I have saved, I can save 6.5%. Should I do this?

  93. I have a short period of time (1 year or less) during which I will have money to invest. What are my investment options?

  94. I'm new to this. Can I sell or buy stock by myself?

  95. Why would a stock have no par value?

  96. What is a wrap account and what are the advantages of using one?

  97. How does somebody make money short selling?

  98. What do T+1, T+2 and T+3 mean?

  99. Are certificates of deposit a kind of bond?

  100. How does an investor make money on bonds?

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Last Questions Asked:
  1.

    What is a triple tax-free municipal bond?

  2. How do you flip a home?

  3. What is the difference between positive and normative economics?

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