Active Trading FAQs

  1. Is it possible to buy mutual funds using a margin account?

  2. What are managed futures?

  3. What does it mean to have "dry powder"?

  4. What are some of the features and benefits of SEP IRAs and Roth IRAs?

  5. What does "buy and hold" mean?

  6. What do all of the letters in a stock option ticker symbol mean?

  7. I own shares of a company that just received a delisting notice from Nasdaq. Does this mean I will lose my shares?

  8. What is the difference between a simple moving average and an exponential moving average?

  9. What is the difference between a quote driven market and an order driven one?

  10. How does a stop-loss order work, and what price is used to trigger the order?

  11. What risks do organizations face when engaging in international finance activities?

  12. What will happen to my SEP IRA if I leave my current employer?

  13. I've noticed executives buy a lot of stock below market value, and then they sell it for a large gain. How can they do this?

  14. I just opened an IRA. What can I do to help my money grow?

  15. What is a gatekeeper?

  16. I do not want to totally get out of my retirement 401(k), but I want to take 72(t) distributions. What should I consider?

  17. How do I go about opening up a Roth IRA?

  18. What does it mean to use technical divergence in trading?

  19. Why does my broker allow me to enter only day orders for short selling?

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

  21. What is the haircut rate imposed by clearing corporations?

  22. When does one sell a put option, and when does one sell a call option?

  23. What methods can be used to fund a forex account?

  24. What is options backdating?

  25. How is the Parabolic SAR used in trading?

  26. At what point in the ordering process does a broker charge commission?

  27. Can I leave my pension to my spouse when I pass away?

  28. What does negative shareholder equity on a balance sheet mean?

  29. What is a margin account?

  30. What number of shares determines adequate liquidity for a stock?

  31. My broker just sold securities out of my account without my permission. Is this legal?

  32. What's the difference between a straddle and a strangle?

  33. What is the cheapest, fastest way to research, buy and trade stock?

  34. Should I buy options that are in the money or out of the money?

  35. How long does a stock that has done a reverse split keep the letter "D" at the end of its symbol?

  36. How do you tell whether an option is American or European style?

  37. Why do some stock quotes appear in bold print in the newspaper?

  38. What is authorized stock?

  39. What happens to my call options if the underlying company is bought out?

  40. What is the difference between Series 9/10 and Series 24 qualification exams?

  41. What was "Operation Wooden Nickel"?

  42. What is the chaos theory?

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

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

  45. What is late-day trading? Why is it any different from buying and selling stocks in the after-hours market?

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

  47. How can a company trade more shares in one day than there are shares outstanding?

  48. Is finance an art or a science?

  49. How is spread calculated when trading in the forex market?

  50. How can I invest in gold?

  51. What are the risks of having both high operating leverage and high financial leverage?

  52. What is the difference between open-market and closed-market transactions?

  53. How can I use market breadth to my advantage?

  54. How is margin interest calculated?

  55. What is the "random walk theory" and what does it mean for investors?

  56. Why was Microsoft subject to antitrust charges in 1998?

  57. How do investors "chase the market"? It this a bad thing?

  58. What is earnings management?

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

  60. I own options on a stock, and it's just announced a split. What happens to my options?

  61. Which option is better on a mutual fund: a growth option or a dividend reinvestment option?

  62. Can technical analysis be called a self-fulfilling prophecy?

  63. How do I measure option liquidity?

  64. Do stop or limit orders protect you against gaps in a stock's price?

  65. Where do I place my target when the price of a stock breaks out of a technical chart pattern?

  66. Can an option have a negative strike price?

  67. Why are corporations so concerned about their stock price?

  68. Where do investors tend to put their money in a bear market?

  69. I have a KSOP through my employer that I've invested 100% in company stock. I am now concerned that I'm not diversified and would like to move out of company stock and into mutual funds. Is this allowed with the funds I've contributed to the account?

  70. Who is Mr. Copper?

  71. What's the difference between a golden handshake and a golden parachute?

  72. What is the homo economicus?

  73. What does it mean to book the basis?

  74. How do I "vest" something?

  75. Which statements about fill-or-kill orders are FALSE?

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