Last Exam Flashcards
A strong currency means importation is cheap.
true
A weak currency means exportation is expensive.
false
In FOREX, prices change in small increments and fast.
true
FOREX is the most liquid investment as there are many buyers and sellers at the same
time.
true
Tourism is one of the biggest contributors to the stability of a given currency.
true
The Foreign Direct Investment (FDI) brings in more peso to the Philippines.
false
The Gross International Reserve (GIR) is the country’s reserve of dollar and other foreign
currencies.
true
Pegged FOREX adheres to the law of supply and demand in currencies.
false
Same as bonds. BIP is used to determine price movement of a currency
false
Currency is defined as a medium of exchange of goods and services.
true
Google is an example of a cryptocurrency.
false
When buying and selling currencies trades are conducted in blocks
false
Only listed companies need funds.
false
Public corporations are listed in the stock market.
true
Stock markets are primary markets.
false
Funds needed by a corporation are obtained at the secondary market.
false
If you buy shares of stocks of a company, you are a part owner of that said company
true
The main issue when a corporation issues additional stock to raise funds, is that they are
giving up control.
true
In stock trading, buy high, sell low.
false
The Philippine stock index (PSEl) is composed of 31 actively traded companies.
false
Cash dividend is one of the ways to earn income when investing into stocks.
true
There is no rejection or non-acceptance of stock subscription even it has exceeded both
maximum gain or loss of the said stock.
false
In the PSE, ALL SHARES represent all the shares of the listed companies in the stock
market.
true
When buying stocks, the first thing you should do is choose a stockbroker.
true
This is another way to analyze a listed company, take a look at the track records of those
managing and how well-managed the company is.
true
A certificate is issued when you buy shares of stocks.
false
Bonds can be interchangeably used with the word fixed income.
true
A bond is like a time deposit, with fixed rate, maturity.
true
Bonds, just like stocks, are risky assets.
true
There is an inverse relationship between interest and price.
true
Coupon rate = YTM, the price of the bond is at par.
true
Coupon rate > YTM, the price of the bond is trading at a discount
false
Coupon rate < YTM, the price of the bond is trading at a premium.
false
RTB 15-1 means it will mature after 15 years and it is the first issue.
true
Interest rate is computed as I = PxRxT/360 or 365.
true
RTB/Treasury Bills/FXTN/ROP are examples of corporate securities
false
GS are considered default risk free rate
true
Sell high, buy low if you use yield basis in buying bonds
false
Government and corporations can issue bonds.
true
Financial Institutions have nothing to do with the bond issuance as they are not issuers
neither buyers of these securities.
false
Coupon payments can be monthly, quarterly, semiannual and annual
true
In the Philippines, peso being the legal tender, can only issue a peso denominated
bonds.
false
All bonds should have an issuer
true
Bonds are held under these three categories: Held for trading, available to sale, held to
issuance.
false
Economic news will affect bond trading
true
Yields move as prices move
true
Rates are all quoted gross
true
Yields move by BIPs (basis points).
true
It is on the secondary market that the issuer of the bond will obtain the needed funds
false
Only listed companies need funds
false
Bonds are illiquid assets.
Public corporations are listed in the stock market.
true
Stock markets are primary markets
false
Fund needed by a corporation is obtained at the secondary market.
false
If you buy shares of stocks of a company, you are a part owner of that said company.
true
The main issue when a corporation issues additional stocks to raise funds, is that they
are giving up control.
true
Companies can borrow funds at the financial markets
true
The Philippine stock index (PSE) is composed of 31 actively traded companies.
false
Cash dividend is one of the ways to earn income when investing into stocks.
true
There is no rejection or non-acceptance of stock subscription even it has exceeded both
maximum gain or loss of the said stock.
false
In the buying transaction of stocks, you will be paying more because of commission and
fees charged by the offices involved in the said stock transactions.
true
In the PSE, ALL SHARES represent all the shares of the listed companies in the stock
market
true
In analyzing what stocks to buy or to sell, we have three fundamental approaches: Top
Down approach ,Bottom Up and sideways
false
When buying stocks, the first thing you should do is choose a stock broker
true
This is another way to analyze a listed company, take a look at the track records of those
managing and how well-managed the listed company is
true
A certificate is issued when you buy shares of stocks.
false
No two clients have the same financial needs
true
Asset allocation is not essential in portfolio management
false
This is the person that counsels and does investment on behalf of a client
Portfolio manager
Risk is unavoidable that is why we need to manage them.
true
This is defined as the art and science of making decisions about the investment mix and
policy, matching investment to objectives
Portfolio management
If you are given this exchange rate USD/CAD =1.28, which currency is strong?
USD
This is a statistical measure of volatility by calculating the variance in prices as it moves
to the mean or average return over a period so the higher the variance, the more
volatile the investments.
Standard deviation
This refers to the collection of investment tools such as stocks, bonds, cash, and so on.
portfolio
This is the position of a trader when he is expecting the market to go down, usually a
trader here is pessimistic
short position
In portfolio management, you need to have an aggressive investment profile
false
This is getting into different classes to diversify the portfolio of a client basing on his
objectives and risk appetite.
Diversification
Diversification being a risk management technique is not a key element in portfolio
management
false
This is the foreign currency reserves of a given country.
Gross international reserves
Matching your investment to your financial obligation is one of the roles of a portfolio
managers
false
This is used to measure volatility against the benchmark
Alpha