Question 1

The Dow Theory puts emphasis on long run trends.

Accepted Answer

A) True 
 B)False  True

Question 2

While the Dow Jones Industrial Average may be weighted toward large firms,a(n)__________ indicator may be used to examine all stocks on an exchange.

Accepted Answer

A) Key 
B) Contrary opinion 
C) Breadth of the market 
D) More than one of the above 
A) Key 
B) Contrary opinion 
C) Breadth of the market 
D) More than one of the above C

Question 3

A normal short sale ratio is between

Accepted Answer

A) That all securities are efficiently priced at any point in time.0.-5 
B) That only common stocks are efficiently priced at any point in time.1.0-2.0 
C) That only bonds are efficiently priced at any point in time.2.0-3.0 
D) Over 3.0 
A) That all securities are efficiently priced at any point in time.0.-5 
B) That only common stocks are efficiently priced at any point in time.1.0-2.0 
C) That only bonds are efficiently priced at any point in time.2.0-3.0 
D) Over 3.0 C

Question 4

Barron's Confidence Index has only a mixed record of success.

Accepted Answer

A) True 
 B)False

Question 5

When short sellers are bearish,it is thought to be a bullish signal.

Accepted Answer

A) True 
 B)False

Question 6

The ideas that stock prices tend to move in trends that persist for long periods and that these trends can be detected in charts are basic assumptions of fundamental analysis.

Accepted Answer

A) True 
 B)False

Question 7

The short interest ratio is the total short sales position divided by average daily exchange volume.

Accepted Answer

A) True 
 B)False

Question 8

The Barron's Confidence Index is based on the premise that bond traders,being more sophisticated than stock traders,pick up trends more quickly.

Accepted Answer

A) True 
 B)False

Question 9

The support level is the stock price that generates new demand,while the resistance level is the price at which investors begin to sell in order to take a profit.

Accepted Answer

A) True 
 B)False

Question 10

Chartists carefully read point and figure charts to observe market patterns (where there is support,resistance,breakouts,congestion,etc.).

Accepted Answer

A) True 
 B)False

Question 11

The problem in reading charts has always been:

Accepted Answer

A) With the errors that are frequently made in the graphing process 
B) Understanding the past market movements 
C) In analyzing the patterns in such a fashion that they truly predict stock market movements before they unfold 
D) None of the above 
A) With the errors that are frequently made in the graphing process 
B) Understanding the past market movements 
C) In analyzing the patterns in such a fashion that they truly predict stock market movements before they unfold 
D) None of the above

Question 12

A point and figure chart is used to demonstrate

Accepted Answer

A) Advances and declines of stock prices 
B) High,low and closing price on a daily basis 
C) Changes of two points or more 
D) More than one of the above 
A) Advances and declines of stock prices 
B) High,low and closing price on a daily basis 
C) Changes of two points or more 
D) More than one of the above

Question 13

Point and figure charts emphasize significant price changes and price reversals.

Accepted Answer

A) True 
 B)False

Question 14

The ____________ suggests watching the small investor,who is right most of the time but misses key market turns,and then doing the opposite.

Accepted Answer

A) Contrary opinion rule 
B) Odd-lot theory 
C) Greed index 
D) None of the above 
A) Contrary opinion rule 
B) Odd-lot theory 
C) Greed index 
D) None of the above

Question 15

Divergence between advances and declines in a breadth of the market indicator and the Dow Jones Industrial Average may signal a reversing trend in the market.

Accepted Answer

A) True 
 B)False

Question 16

The breadth of the market indicator

Accepted Answer

A) Attempts to measure what a broad range of securities is doing as opposed to merely examining a market average 
B) Can be used to analyze upturns in the market 
C) Compares the advance-declines with the movement of a popular market average to determine if there is divergence between the two 
D) All of the above 
A) Attempts to measure what a broad range of securities is doing as opposed to merely examining a market average 
B) Can be used to analyze upturns in the market 
C) Compares the advance-declines with the movement of a popular market average to determine if there is divergence between the two 
D) All of the above

Question 17

All of the following are smart money rules except

Accepted Answer

A) Investment advisory recommendations 
B) Short sales by specialists 
C) Barron's Confidence Index 
D) None of the above are exceptions 
A) Investment advisory recommendations 
B) Short sales by specialists 
C) Barron's Confidence Index 
D) None of the above are exceptions

Question 18

Technical analysis is based on all of the following assumptions except

Accepted Answer

A) Market value is determined by the interaction of demand and supply 
B) Stocks with strong earnings gains will outperform the market 
C) The assumption that though there are minor fluctuations in the market,stock prices tend to move in trends that persist for long periods of time 
D) Shifts in demand and supply can be detected sooner or later 
E) Reversals of trends are caused by shifts in demand and supply. 
A) Market value is determined by the interaction of demand and supply 
B) Stocks with strong earnings gains will outperform the market 
C) The assumption that though there are minor fluctuations in the market,stock prices tend to move in trends that persist for long periods of time 
D) Shifts in demand and supply can be detected sooner or later 
E) Reversals of trends are caused by shifts in demand and supply.

Question 19

The Barron's Confidence Index is used to observe the trading pattern of investors in the stock market.

Accepted Answer

A) True 
 B)False

Question 20

A support level signals new demand.

Accepted Answer

A) True 
 B)False

Exam 9: A Basic View of Technical Analysis and Market Efficiency

The Dow Theory puts emphasis on long run trends.

While the Dow Jones Industrial Average may be weighted toward large firms,a(n)__________ indicator may be used to examine all stocks on an exchange.

A normal short sale ratio is between

Barron's Confidence Index has only a mixed record of success.

When short sellers are bearish,it is thought to be a bullish signal.

The ideas that stock prices tend to move in trends that persist for long periods and that these trends can be detected in charts are basic assumptions of fundamental analysis.

The short interest ratio is the total short sales position divided by average daily exchange volume.

The Barron's Confidence Index is based on the premise that bond traders,being more sophisticated than stock traders,pick up trends more quickly.

The support level is the stock price that generates new demand,while the resistance level is the price at which investors begin to sell in order to take a profit.

Chartists carefully read point and figure charts to observe market patterns (where there is support,resistance,breakouts,congestion,etc.).

The problem in reading charts has always been:

A point and figure chart is used to demonstrate

Point and figure charts emphasize significant price changes and price reversals.

The ____________ suggests watching the small investor,who is right most of the time but misses key market turns,and then doing the opposite.

Divergence between advances and declines in a breadth of the market indicator and the Dow Jones Industrial Average may signal a reversing trend in the market.

The breadth of the market indicator

All of the following are smart money rules except

Technical analysis is based on all of the following assumptions except

The Barron's Confidence Index is used to observe the trading pattern of investors in the stock market.

A support level signals new demand.

The Investment Setting

Security Markets: Present and Future

Participating in the Market

Sources of Investment Information

Economic and Industry Analysis

Industry Analysis

Valuation of the Individual Firm

Financial Statement Analysis

Investment in Special Situations and Anomalies

Bond and Fixed Income Fundamentals

Principles of Bond Valuation and Investment

Duration and Reinvestment Concepts

Convertible Securities and Warrants

Put and Call Options

Commodities and Financial Futures

Stock Index Futures and Options

Mutual Funds

International Securities Markets

Investment in Real Assets

A Basic Look at Portfolio Management and Capital Market Theory

Measuring Risks and Returns of Portfolio Managers

Sustainable Growth Model

a Black Scholes Option Pricing Model

A Comprehensive Analysis for Real Estate Investment Decisions

Unit Investment Trusts Uits

The Makeup of Institutional Investors

Filters