Online Investing Tools and Resources
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Questions and Answers

Most brokers charge higher commissions for online trades than for telephone transactions.

False

Online trading has greatly lowered the cost of buying and selling stock and has greatly increased the speed of transactions.

True

For most stocks, charts and tables of historical prices are only available through subscription services.

False

You can utilize the internet to develop financial plans and goals, analyze and select individual investments and organize your portfolio.

<p>True</p> Signup and view all the answers

An investor who mistakenly buys the wrong stock because the symbols are similar has 24 hours to undo the trade.

<p>False</p> Signup and view all the answers

The tools and calculators available on the FINRA website are useful, but quite expensive to use.

<p>False</p> Signup and view all the answers

The cost of using industry-sponsored websites such as FINRA usually exceeds the benefits for small investors.

<p>False</p> Signup and view all the answers

What are some of the tools available to investors on the internet? (Name at least 4.)

<p>Investors can utilize numerous tools on the internet, including stock screeners, portfolio trackers, financial calculators, and research reports, to analyze investments effectively.</p> Signup and view all the answers

Analytical information would include information such as estimates of growth in sales and future earnings.

<p>True</p> Signup and view all the answers

Reviewing industry and company information may provide guidance on the future outlook of a particular firm.

<p>True</p> Signup and view all the answers

A listing of a firm's major product lines and projections of future sales would both be considered descriptive information.

<p>False</p> Signup and view all the answers

Descriptive information might include the company's lines of business, a list of major competitors, and recent changes in management.

<p>True</p> Signup and view all the answers

Current price information on shares of a company's stock is often accompanied by statistics on the recent price behaviour of that stock.

<p>True</p> Signup and view all the answers

Investors who are aware of current economic, political, and market events tend to make better investment decisions.

<p>True</p> Signup and view all the answers

Often, on short-term trades of less than one year, you'll pay taxes on profits at the higher ordinary income tax rates, not the lower capital gains rate.

<p>True</p> Signup and view all the answers

Investors can usually find the financial statements of a firm on the firm's website.

<p>True</p> Signup and view all the answers

A "pump and dump" scheme involves buying shares of stock, hyping that stock via the internet and then quickly selling the shares at a profit.

<p>True</p> Signup and view all the answers

An index measures the current value of a group of stocks in relation to a base value established previously.

<p>True</p> Signup and view all the answers

All the Standard & Poor's indexes are based on the total market values of the companies rather than on the price of a single share.

<p>True</p> Signup and view all the answers

The Dow Jones Corporate Bond Index and the Dow Jones Industrial Average are both price-weighted averages whose divisors are adjusted periodically to maintain continuity.

<p>True</p> Signup and view all the answers

Standard & Poor's and Mergent both publish extensive data on bonds.

<p>True</p> Signup and view all the answers

In addition to the Dow Jones Industrial Average, the Standard & Poor's 500 and NASDAQ indexes are widely quoted measures of market performance.

<p>True</p> Signup and view all the answers

The Value Line Index is a value-weighted index based on a small sample of the 1700 stocks covered by the Value Line investment reports.

<p>True</p> Signup and view all the answers

The Dow-Jones Corporate Bond Index is entirely based on industrial firms....

<p>False</p> Signup and view all the answers

An internet tool that selects stocks to meet specific criteria such as dividend payout or price-earnings ratio is known as a(n)

<p>screener</p> Signup and view all the answers

Which of the following actions are possible on the internet?

<p>only B and C are correct</p> Signup and view all the answers

Individuals can now use the internet to buy and sell

<p>I, II, III and IV</p> Signup and view all the answers

Information that can be found on the internet at no cost includes

<p>I, II and III only</p> Signup and view all the answers

Which of the following can be considered a pitfall for investors new to on-line trading?

<p>Online investors tend to trade too frequently.</p> Signup and view all the answers

Charting is the technique of

<p>plotting the performance of a security over time.</p> Signup and view all the answers

Which of the following types of information is NOT available from printed publications?

<p>real-time price quotes for widely held stocks and exchange traded funds</p> Signup and view all the answers

Which of the following is a general rather than a financial newspaper?

<p>The Toronto Star</p> Signup and view all the answers

Which of the following is published by the Canadian Government?

<p>Canadian Business Bulletin</p> Signup and view all the answers

The FD in Regulation FD refers to

<p>fair disclosure</p> Signup and view all the answers

Which of the following websites facilitates the review of financial information in a Canadian company's financial reports?

<p>SEDAR website</p> Signup and view all the answers

Which of the following is usually available on a company's website?

<p>annual reports</p> Signup and view all the answers

The published analysis and recommendations of an individual brokerage firm is called a

<p>back-office research report</p> Signup and view all the answers

Assume you wanted to find the most current price for Home Depot's stock. Your most likely source would be

<p>Yahoo! Finance</p> Signup and view all the answers

Recommendations of "strong buy, buy, hold, reduce, sell" are most likely to be found in

<p>brokerage back-office research reports</p> Signup and view all the answers

Subscription letters are

<p>sometimes geared to specific industries and companies.</p> Signup and view all the answers

Which of the following sites is especially valuable for information concerning mutual funds?

<p><a href="http://www.morningstar.com">www.morningstar.com</a></p> Signup and view all the answers

Supersites that accumulate tremendous amounts of investing information that typically includes price history, investment screening tools and other personal finance features are known as

<p>financial portals</p> Signup and view all the answers

Which of the following services provides bond ratings?

<p>Standard &amp; Poor's</p> Signup and view all the answers

Study Notes

Online Investing Tools and Resources

  • Online trading platforms have significantly reduced transaction costs and increased the speed of stock buying and selling
  • Internet enables investors to develop financial plans, analyze investments, and manage portfolios
  • Online tools such as stock screeners help select stocks based on criteria like dividend yield or price-to-earnings ratio
  • Access to financial statements, historical data, and news for publicly traded companies is accessible online.

Online Investing Pitfalls

  • Online investors may trade too frequently, which can negatively impact their returns
  • Investors can still make errors in online trading if stock symbols are similar, requiring careful verification

Investing Information Sources

  • Reliable online sources like FINRA websites offer tools and calculators beneficial for investors, though their cost-effectiveness needs consideration by small investors
  • Online financial portals like Yahoo! Finance offer comprehensive investment tools and data for free
  • Websites like Morningstar are useful for mutual fund information
  • Subscription services provide in-depth reports on financial instruments, specific companies, and market trends

General Investing Information Sources

  • Financial news sources (online and print) provide up-to-date information on economic and market events, beneficial for informed investment decisions
  • Company websites contain useful financial data, including annual reports and recent news, helping investors assess a company's outlook
  • "Pump and dump" schemes involve misleading information and quick stock sales to generate profit, a potential pitfall

Analyzing Investment Performance

  • Charts and historical price data are important tools for stock analysis, available widely on the internet
  • Analyzing current economic, political, and market conditions aid sound investment decisions
  • In short-term trades (under a year), profits are typically taxed as ordinary income, not at the lower capital gains rates
  • Comparing multiple sources for financial data and information benefits investors

Investment Data

  • Indices measure stock groups' current value relative to a previous base value.
  • Some prominent indexes like the Dow Jones Industrial Average, Standard & Poor's 500, and NASDAQ indexes are widely tracked metrics for market performance.
  • Standard & Poor's and Mergent offer substantial bond information.

Financial Disclosure Regulations

  • Regulation FD mandates fair disclosure of information to all investors.

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Description

Test your knowledge on online investing tools and resources, including various trading platforms and financial analysis methods. Learn about the potential pitfalls of online investing and discover reliable information sources. This quiz will help you navigate the complex world of online finance effectively.

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