Market Analysis

Question 1

What is the leading economic indicator?

Answer 1

stock market

Question 2

What happens to the market if inflation is anticipated to rise?

Answer 2

Interests rates rise, prices on market go down

Question 3

What causes currency appreciation?

Answer 3

consistently having trade surpluses

Question 4

Types of foreign currency trade settlement

Answer 4

spot market - 1 or 2 business days

forward contract - usually months in the future

Question 5

currency risk

Answer 5

combined risk of exchange rate, market risk and large size of foreign currency trades

Question 6

How many stocks are in the Dow Jones Industrial Average?

Answer 6

30

Question 7

How many stocks are in the Dow Jones Composite?

Answer 7

65 - 30 from djia, 20 transportation, 15 utilities

Question 8

Dow Theory

Answer 8

If transportation average moves with industrials, it is an accurate sign of the market

Question 9

Odd lot theory

Answer 9

Small investor always wrong, so you should purhcase in the opposite of whatever odd lots are doing

Question 10

short interest theory

Answer 10

large number of open shorts bullish for long term because sellers will have to cover their positions