FAQs tagged as

Investing-Basics

  1. What is a boiler room operation?

  2. Is technical analysis used only to analyze stocks?

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

  4. I have only $500 to invest, am I limited to buying only penny stocks?

  5. I live in the U.S. How can I trade stocks in China and India?

  6. What methods can be used to measure and profit from investor sentiment?

  7. How are foreign exchange rates affected by commodity price fluctuations?

  8. What are reverse stock splits?

  9. Why are options very active when they are at the money?

  10. What are the three phases of a completed initial public offering (IPO) transformation process?

  11. What does "buy on the cannons, sell on the trumpets" mean?

  12. What is authorized stock?

  13. If a company undergoes an acquisition can an employee withdraw 401(k) funds tax free?

  14. What happens when a circuit breaker is put into effect?

  15. How do you determine a company's percentage of credit sales?

  16. What is securitization?

  17. Where can I find information on different companies so that I won't have to read every earnings report?

  18. What is a typical day in the life of someone in M&A? How long does a project last?

  19. How does pyramiding work?

  20. What is an echo bubble?

  21. What are the differences between chapter 7 and chapter 11 bankruptcy?

  22. What's the difference between bottom-line and top-line growth?

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

  24. How does somebody make money short selling?

  25. What's the smallest number of shares of stock that I can buy?

  26. What are unrealized gains and losses?

  27. When must a company announce earnings?

  28. What is a tranche?

  29. What is the difference between fast and slow stochastics in technical analysis?

  30. If I short sell $5,000 worth of stock and the stock becomes worthless, I have made $5,000 with a very small investment. Isn't the return here much greater than 100%?

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

  32. What's the difference between net present value and internal rate of return? How are they used?

  33. What is the difference between economic value added and market value added?

  34. If I sell my shares before the ex-dividend date will I still get the dividend?

  35. What does it mean when the shares in my account have been liquidated?

  36. How do I calculate the adjusted closing price for a stock?

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

  38. How do businesses decide whether to do FDI via green field investments or acquisitions?

  39. Who sets the price of commodities?

  40. What is a GTEM order?

  41. Who or what are the turtles?

  42. What is fair capital?

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

  44. Is there such a thing as a foolproof stock-picking strategy?

  45. What causes a recession?

  46. What is market capitulation?

  47. What do the S&P, Dow and Nasdaq futures contracts represent?

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

  49. Is it important to check the professional history of my investment advisor?

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

  51. What is a DRIP?

  52. What are pro forma earnings?

  53. What are the "Dogs of the Dow"?

  54. Why would a person choose a mutual fund over an individual stock?

  55. Which is better a cash dividend or a stock dividend?

  56. What is the difference between investment banks and merchant banks?

  57. Is it true that you can sell your home and not pay capital gains tax?

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

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

  60. Does a stock dividend dilute the price per share as would a forward stock split?

  61. Can a corporation deduct dividend payments to shareholders before taxes are calculated?

  62. How do I buy an over-the-counter stock?

  63. What does "squeezing the shorts" mean?

  64. What is a virtual trailing stop order (VTSO)?

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

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

  67. How does a credit crunch occur?

  68. How can I find out if a company I like is included in an index?

  69. What was "Operation Wooden Nickel"?

  70. Who is Mr. Copper?

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

  72. What's the smallest number of shares I can buy?

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

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

  75. If I have a number of stock shares and that company reports earnings of X amount per share, do I receive those earnings?

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

  77. Where does the money I have invested in a company go when the stock price decreases?

  78. What is a "socially responsible" mutual fund?

  79. Are IPOs available to short sell immediately upon trading, or is there a time limit that must pass before short sales are accepted?

  80. What happens when the lender of the borrowed shares in a short sale transaction wants to sell his/her shares?

  81. After an initial public offering, does a company profit from increases in its share price?

  82. What technical tools can I use to measure momentum?

  83. What is dilutive stock?

  84. Why won't my broker allow me to sell one stock and buy another on the same day?

  85. How are realized profits different from unrealized or so-called "paper" profits?

  86. How does leverage work in the forex market?

  87. How do speculators profit from options?

  88. How are futures used to hedge a position?

  89. How do you get a hard copy of a stock certificate?

  90. Does a strong trend (ADX > = 40) cause an increase in volatility?

  91. Which is better for tax deductions, itemization or a standard deduction?

  92. Can I give stock as a gift?

  93. What are green investments?

  94. What is Black Monday?

  95. What is meant by "full disclosure"?

  96. When is a dividend payment recognized in the shareholders equity portion of the balance sheet?

  97. Use the following information about a customer’s margin account to answer the question.

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

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

  100. What are the listing requirements for the Nasdaq?

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