HOW STUFF WORKS
QUIZZES

FOLLOW US
The Ultimate Stock Futures Quiz
by Staff
Investing in stock futures is an excellent method to hedge your investments so that market fluctuations don't lead to major financial losses. You won't be immune to market ups and downs, but you will be shielded to some extent. That said, investing in stock futures is risky business. Take the time to learn all about it with our very informative quiz.

A contract to trade a specified amount of stock at a specified price on a specified future date is called:

  • a stock future
  • a stock contract
  • a stock agreement

When you buy stocks that are traded on the stock exchange, you earn money when the price of your stock:

  • goes up
  • goes down
  • stays the same

When you own stock in a corporation, you can earn _____ on a regular basis.

  • income
  • dividends
  • rebates

The basic positions on stock futures are called:

  • long
  • short
  • both of the above

Who might issue a margin call?

  • your banker
  • your stockbroker
  • your accountant

The idea behind _____ is to protect yourself against market downturns by taking opposite positions on the same investment.

  • pruning
  • raking
  • hedging

A _____ is when you go both short and long on the same stock future with two different delivery dates.

  • double spread
  • calendar spread
  • single spread

An_____ involves going long and short on two different stock futures in related markets.

  • international spread
  • intercity spread
  • intermarket spread

A _____ is when you enter a futures contract to buy shares in two competing companies.

  • matched pair spread
  • unmatched pair spread
  • matched single spread

When you _____ a stock, you use a small amount of money to buy a large amount of stock.

  • leverage
  • mortgage
  • average

When you buy traditional stocks on margin, you use your _____ as collateral for the loan.

  • stock
  • house
  • car

Since your basically borrowing money to invest in stock futures when buying on margin, you run the risk of:

  • losing your entire investment
  • owing more money
  • both of the above

Which United States law reintroduced the trading of single stock futures?

  • the Commodity Futures Modernization Act
  • the Stock Futures Modernization Act
  • the Stock Market Modernization Act

Individual investors in single stock futures are known as:

  • day traders
  • night traders
  • single traders

What do we call a large group of investors who pool their money in the same portfolio?

  • a commodity pool
  • a commodity group
  • a community pool