General Trading Knowledge - Example Questions

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| By Jeff

Jeff

Community Contributor

Quizzes Created: 1 | Total Attempts: 192

Questions: 5 | Attempts: 192 | Updated: Mar 22, 2023

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Questions and Answers

1.

The use of margin to maximize the advantage of an investment is considered:
- A.
  
  A. Delta
- B.
  
  B. Positoning
- C.
  
  C. Leverage
- D.
  
  D. Volatility
Correct Answer
C. C. Leverage

Explanation
C. The use of margin to maximize the advantage of an investment is considered leverage.

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2.

When a support area is held, buyers tend to come into the market:
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
True. When a support area is held, buyers tend to come into the market.

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3.

You are watching a financial network and you hear a recommendation by an analyst you admire. You should:
- A.
  
  A. Follow the advice only if a second opinion agrees
- B.
  
  B. Follow the advice since the analyst appears credible
- C.
  
  C. Complete your own due diligence
- D.
  
  D. Do the opposite of the recommendation
Correct Answer
C. C. Complete your own due diligence

Explanation
C. Completing your own due diligence is the obvious choice.

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4.

An Exchange Traded Fund (ETF) is similar to Mutual Funds except:
- A.
  
  A. They bundle securities
- B.
  
  B. Are subject to volatility
- C.
  
  C. They trade throughout the day
- D.
  
  D. Diversified portfolios
Correct Answer
C. C. They trade throughout the day

Explanation
C. An ETF trade throughout the day. Mutual Funds only trade at the end of the day at the net asset value (NAV) price.

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5.

Which one do you like?
- A.
  
  Option 1
- B.
  
  Option 2
- C.
  
  Option 3
- D.
  
  Option 4
Correct Answer
A. Option 1

General Trading Knowledge - Example Questions

The use of margin to maximize the advantage of an investment is considered:

When a support area is held, buyers tend to come into the market:

You are watching a financial network and you hear a recommendation by an analyst you admire. You should:

An Exchange Traded Fund (ETF) is similar to Mutual Funds except:

Which one do you like?