Capital Markets and Volatility Quiz

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Questions and Answers

What is meant by capital markets?

  • Markets where buyers and sellers trade ownership rights of assets (correct)
  • Investment vehicles that guarantee fixed returns
  • A method of securing loans through collateral
  • Platforms for exclusive trading of cryptocurrencies

What does the term volatility refer to in investing?

  • The amount of cash required to invest
  • The frequency of trades in a market
  • The degree of variation of a trading asset's price (correct)
  • The stability of an investment over time

Which of the following best describes an investment portfolio?

  • A financial statement summarizing income and expenses
  • A method for assessing market trends and future positions
  • A list of all available market investments and their historical performance
  • A collection of financial assets owned by an individual or organization (correct)

Which statement accurately defines an IPO?

<p>A process by which a company offers its shares to the public for the first time (A)</p> Signup and view all the answers

In the context of financial markets, what differentiates bear markets from bull markets?

<p>Bull markets are characterized by rising prices, while bear markets are marked by declining prices (A)</p> Signup and view all the answers

Flashcards

Capital Markets

Where buyers and sellers exchange capital for ownership of assets, like stocks and cryptoassets. This includes institutions facilitating the trading.

Volatility

A measurement of how much an asset's price changes over time.

Investment Portfolio

A collection of investments held by a person or organization.

Dividend

A payment made by a company to its shareholders from its profits.

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IPO

Initial Public Offering - when a company sells shares of stock to the public for the first time

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Study Notes

Capital Markets

  • Capital markets are places where people exchange money (capital) for ownership of assets.
  • Assets traded can include stocks, cryptoassets, etc.
  • These markets often have institutions like stock exchanges for trading
  • Traders hope to gain profit from these investments.

Volatility

  • Volatility measures how much an asset's price changes.

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