ch4.Trading and Technology

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What has technology transformed in the trading industry?

The structure of a marketplace (correct)

The capabilities of IT in a frictionless market

The price determination and trading in a frictionless environment

The submission and prioritization of buy and sell orders

Which technology company runs transactions platforms that handle an average daily volume of currency trades of nearly $500 billion in 2020?

Dealing

NYSE

StockWatch

Refinitiv (correct)

What is the purpose of an audit trail of trades in the case of a fraud or market manipulation investigation?

To speed up investigations (correct)

To disseminate market information

To monitor trading activities

To provide trade confirmation

Which system introduced in 1976 imposed unified trade reporting rules and facilitated ticker publication of last sale information from any of eight US stock markets?

Consolidated Tape System (CTS) Signup and view all the answers

Which two cryptocurrencies are mentioned as the most popular in 2021?

Bitcoin and Ethereum Signup and view all the answers

What is the purpose of the SWIFT messaging service?

To enhance the services offered by participating banks Signup and view all the answers

What is the lowest layer of the IT infrastructure stack?

Hardware and infrastructure Signup and view all the answers

What are the three basic economic functions performed by financial markets?

Bring together buyers and sellers, provide price and trading volume information, and promote trust Signup and view all the answers

Which of the following is NOT a function of financial markets?

Manufacturing products Signup and view all the answers

What is the purpose of open outcry trading?

To maximize the chance of finding a counterparty Signup and view all the answers

What is the role of intermediaries in financial markets?

To provide liquidity Signup and view all the answers

What is the purpose of enforcing rules in computerized markets?

To generate trust and enforce fairness Signup and view all the answers

Which technology is critical for algorithmic trading and high-frequency trading (HFT) in financial markets?

Telecommunications networks Signup and view all the answers

What is the purpose of packet switching protocols in networks?

To move data in separate blocks through network segments Signup and view all the answers

Why do HFT traders pay for 'collocation services'?

To reduce latency in trading Signup and view all the answers

What is the role of information systems in trading?

To facilitate order collection Signup and view all the answers

Which technology has the potential to radically change the operations of markets and widen access to trading venues and the safe settlement of transactions?

Distributed Ledger Technology (DLT) and Blockchain applications Signup and view all the answers

What is a blockchain?

A data structure used in distributed ledgers that store and transmit packages of data called blocks Signup and view all the answers

Which technology powers trading today and is crucial for participants in financial markets to understand?

All of the above Signup and view all the answers

What are disruptive innovations in the financial markets?

Innovations that lead to new entrants challenging incumbent organizations and to a reordering of the players in the industry Signup and view all the answers

Which market is characterized by a transaction occurring today at a set price for an asset that the purchaser (seller) may not own (deliver) until some months or years into the future?

Derivatives market Signup and view all the answers

What is the term used to describe a situation in which oil futures for 'back months' are less expensive than the current month?

Backwardation Signup and view all the answers

What is the bid and ask quote for the August 2021 contract for West Texas Intermediate (WTI) crude oil?

71.69 and 71.70 Signup and view all the answers

What is the value of the shares of GOOG that have changed hands so far on the day?

$783.527 million Signup and view all the answers

Which technology company runs transactions platforms that handle an average daily volume of currency trades of nearly $500 billion in 2020?

Refinitiv Signup and view all the answers

Which system introduced in 1976 imposed unified trade reporting rules and facilitated ticker publication of last sale information from any of eight US stock markets?

CTS Signup and view all the answers

Which technology was the first fully automated stock market in the United States?

Nasdaq Signup and view all the answers

What is the purpose of Distributed Ledger Technology (DLT)?

To record and share data across multiple ledgers or data stores Signup and view all the answers

What are the three key technologies that power trading today?

Application software, database systems, networks Signup and view all the answers

What is the role of information systems (I.S.) professionals in the financial markets industry?

All of the above Signup and view all the answers

Which technology innovation was developed by the NYSE in 1976 to electronically route small market orders to the trading floor?

Designated Order Turnaround (DOT) system Signup and view all the answers

What is the purpose of the Society for Worldwide Interbank Financial Telecommunications (SWIFT) messaging service?

To enhance the services offered by participating banks Signup and view all the answers

Which type of market order in an open outcry floor market is required to trade at the highest available bid price?

Market order to sell Signup and view all the answers

In computerized markets, how are limit orders executed?

According to price-time priority rules Signup and view all the answers

What is the purpose of markets in facilitating buying and selling?

To provide liquidity Signup and view all the answers

What is the value of financial assets that can be readily converted into cash?

Higher than other assets Signup and view all the answers

Which technology is crucial for algorithmic trading and high-frequency trading (HFT) in financial markets?

Telecommunications networks Signup and view all the answers

What is the purpose of packet switching protocols in networks?

To reduce latency in data transmission Signup and view all the answers

What technology do HFT traders pay for to reduce latency in order execution?

Collocation services Signup and view all the answers

Which market is characterized by a transaction occurring today at a set price for an asset that the purchaser (seller) may not own (deliver) until some months or years into the future?

Derivatives market Signup and view all the answers

What are the three essential technologies in computerizing a financial market?

Shared data files, high-capacity networks, and application software Signup and view all the answers

ch4.Trading and Technology

Podcast Beta

Questions and Answers

What has technology transformed in the trading industry?

Which technology company runs transactions platforms that handle an average daily volume of currency trades of nearly $500 billion in 2020?

What is the purpose of an audit trail of trades in the case of a fraud or market manipulation investigation?

Which system introduced in 1976 imposed unified trade reporting rules and facilitated ticker publication of last sale information from any of eight US stock markets?

Which two cryptocurrencies are mentioned as the most popular in 2021?

What is the purpose of the SWIFT messaging service?

What is the lowest layer of the IT infrastructure stack?

What are the three basic economic functions performed by financial markets?

Which of the following is NOT a function of financial markets?

What is the purpose of open outcry trading?

What is the role of intermediaries in financial markets?

What is the purpose of enforcing rules in computerized markets?

Which technology is critical for algorithmic trading and high-frequency trading (HFT) in financial markets?

What is the purpose of packet switching protocols in networks?

Why do HFT traders pay for 'collocation services'?

What is the role of information systems in trading?

Which technology has the potential to radically change the operations of markets and widen access to trading venues and the safe settlement of transactions?

What is a blockchain?

Which technology powers trading today and is crucial for participants in financial markets to understand?

What are disruptive innovations in the financial markets?

Which market is characterized by a transaction occurring today at a set price for an asset that the purchaser (seller) may not own (deliver) until some months or years into the future?

What is the term used to describe a situation in which oil futures for 'back months' are less expensive than the current month?

What is the bid and ask quote for the August 2021 contract for West Texas Intermediate (WTI) crude oil?

What is the value of the shares of GOOG that have changed hands so far on the day?

Which technology company runs transactions platforms that handle an average daily volume of currency trades of nearly $500 billion in 2020?

Which system introduced in 1976 imposed unified trade reporting rules and facilitated ticker publication of last sale information from any of eight US stock markets?

Which technology was the first fully automated stock market in the United States?

What is the purpose of Distributed Ledger Technology (DLT)?

What are the three key technologies that power trading today?

What is the role of information systems (I.S.) professionals in the financial markets industry?

Which technology innovation was developed by the NYSE in 1976 to electronically route small market orders to the trading floor?

What is the purpose of the Society for Worldwide Interbank Financial Telecommunications (SWIFT) messaging service?

Which type of market order in an open outcry floor market is required to trade at the highest available bid price?

In computerized markets, how are limit orders executed?

What is the purpose of markets in facilitating buying and selling?

What is the value of financial assets that can be readily converted into cash?

Which technology is crucial for algorithmic trading and high-frequency trading (HFT) in financial markets?

What is the purpose of packet switching protocols in networks?

What technology do HFT traders pay for to reduce latency in order execution?

Which market is characterized by a transaction occurring today at a set price for an asset that the purchaser (seller) may not own (deliver) until some months or years into the future?

What are the three essential technologies in computerizing a financial market?

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