Equity Investments EXAMINATION SET
2026 SOLVED QUESTIONS GRADED A+
● GTC order. Answer: Good Til Cancel
-Investor specifies that an order remain active until it is canceled
● Buy 50 shares, limit 12.5, GTC. Answer: Buy as many shares (up to
50) at 12.5 or under, keep order open until closed
● Market Order. Answer: Just take best possible to fill order
● Brokered Markets. Answer: Where investors use brokers to locate a
counterparty to a trade;
Useful with unique or illiquid securities;
Dealers do not carry inventory;
Too few trades to trade in an order-driven market
● Order-driven markets. Answer: A market (generally an auction
market) that uses rules to arrange trades based on the orders that traders
submit; in their pure form, such markets do not make use of dealers.
● Quote Driven Markets. Answer: Investors trade with dealers;
Dealers keep an inventory of securities;
, Most securities other than stocks trade in quote driven markets;
Trading is often electronic
● writer of a put and the holder of a call. Answer: have a long exposure
to the underlying asset because their positions increase in value if the
underlying asset value increases
● Buyer of a put option. Answer: has the right to SELL the underlying
asset at the strike price on or before expiration date
● Price Return. Answer: index uses only the prices of securities; no
dividends
● Total Return. Answer: Index uses price and dividends to calculate
return
● Free Float. Answer: The portion of a listed company's equity
securities that are not held by insiders, strategic investors, sponsors,
founders, and so on, that are more freely available for trading.
● Reconstiution. Answer: Those running the index switching out what
securities make up the index
2026 SOLVED QUESTIONS GRADED A+
● GTC order. Answer: Good Til Cancel
-Investor specifies that an order remain active until it is canceled
● Buy 50 shares, limit 12.5, GTC. Answer: Buy as many shares (up to
50) at 12.5 or under, keep order open until closed
● Market Order. Answer: Just take best possible to fill order
● Brokered Markets. Answer: Where investors use brokers to locate a
counterparty to a trade;
Useful with unique or illiquid securities;
Dealers do not carry inventory;
Too few trades to trade in an order-driven market
● Order-driven markets. Answer: A market (generally an auction
market) that uses rules to arrange trades based on the orders that traders
submit; in their pure form, such markets do not make use of dealers.
● Quote Driven Markets. Answer: Investors trade with dealers;
Dealers keep an inventory of securities;
, Most securities other than stocks trade in quote driven markets;
Trading is often electronic
● writer of a put and the holder of a call. Answer: have a long exposure
to the underlying asset because their positions increase in value if the
underlying asset value increases
● Buyer of a put option. Answer: has the right to SELL the underlying
asset at the strike price on or before expiration date
● Price Return. Answer: index uses only the prices of securities; no
dividends
● Total Return. Answer: Index uses price and dividends to calculate
return
● Free Float. Answer: The portion of a listed company's equity
securities that are not held by insiders, strategic investors, sponsors,
founders, and so on, that are more freely available for trading.
● Reconstiution. Answer: Those running the index switching out what
securities make up the index
