Fundamentals and news quiz

1. What is a share?

1. A small piece of ownership in a company
2. A loan to a bank
3. A type of candle
4. A trading fee

2. What is the difference between price and value?

1. They are always the same
2. Price is what people pay today; value is what the business may be worth
3. Value changes every second and price never does
4. Price is set by the government

3. What does fundamental analysis study?

1. Only the time of day
2. Only trading volume
3. Only candle patterns
4. A company's sales, profits and prospects

4. What does technical analysis study?

1. A company's tax returns
2. Price and volume on the chart
3. The office building
4. The company's logo

5. Which usually changes faster, the share price or the business's value?

1. Neither ever changes
2. The business's value
3. The share price
4. Both at exactly the same speed

6. Why do many traders use both kinds of analysis?

1. Regulators require it
2. Fundamentals suggest what to trade and charts help with when
3. Charts replace all numbers
4. Using both removes all risk

7. Company A has 1,000 shares at 50. What is the whole company valued at?

1. 50,000
2. 1,000
3. 1,050
4. 50

8. Company A has 1,000 shares at 50 and company B has 100 shares at 500. Which does the market value more highly?

1. A, because it has more shares
2. B, by ten times
3. Neither: both are valued at 50,000
4. B, because 500 is higher than 50

9. You own 10 of company A's 1,000 shares. What share of its future profits do you have a claim on?

1. 10%
2. 100%
3. 0.1%
4. 1%

10. A stock trades far above what its profits seem to justify for three years. What does this show?

1. Price can stay far from value for a long time
2. Profits do not matter at all
3. Value analysis is useless
4. The price must crash tomorrow

11. What is revenue?

1. The profit left after costs
2. The number of shares
3. The total money a company earns from customers
4. The share price

12. What is net profit?

1. The share price times the shares
2. Total sales
3. What remains after all costs, interest and taxes
4. Money borrowed

13. What does EPS stand for?

1. Earnings per share
2. Exchange profit system
3. Extra payment share
4. Equity price score

14. A lemonade stand makes 200 of profit and has 4 equal owners. What is each owner's share?

1. 4
2. 50
3. 200
4. 800

15. Net profit is 200,000 and there are 100,000 shares. What is EPS?

1. 200,000
2. 20
3. 2
4. 0.5

16. Revenue is 1,000,000 and net profit is 200,000. What is the profit margin?

1. 5%
2. 80%
3. 2%
4. 20%

17. What else do traders compare results with?

1. The weather
2. Nothing else
3. The color of the logo
4. What analysts expected

18. EPS rose from 1.60 to 2.00 in a year. What is the growth?

1. 40%
2. 20%
3. 0.40%
4. 25%

19. Two companies each have revenue of 1,000,000. One keeps 200,000 as profit and the other 20,000. What differs?

1. Their revenue
2. Their profit margins: 20% against 2%
3. Nothing, so their EPS must be equal
4. Nothing at all

20. Company X has EPS of 10 and company Y has EPS of 2. Does that make X better value?

1. Not by itself; EPS must be compared with each share's price
2. Yes, higher EPS always wins
3. Yes, EPS is the share price
4. No, EPS never matters

21. What moves the price on results day?

1. The day of the week
2. The company's logo
3. The surprise compared with expectations
4. Only whether profit is positive

22. What is a beat?

1. A result of exactly zero
2. A result worse than expected
3. A result better than expected
4. A new share issue

23. What is guidance?

1. The company's outlook for the future
2. The exchange's rules
3. A type of chart
4. Today's share price

24. Can good results send a price down?

1. Only on Mondays
2. Only for crypto
3. No, never
4. Yes, if they fall short of expectations or guidance is cut

25. Analysts expect EPS of 2.00 and the company reports 2.20. What is this?

1. A beat of 0.20
2. A miss of 0.20
3. In line
4. A beat of 2.20

26. A company reports record profits but cuts next year's guidance. What can happen?

1. Trading stops
2. The price can fall
3. Nothing ever happens
4. The price must rise

27. Why can the reaction to results arrive as a gap?

1. Gaps are random
2. Charts skip results days
3. Exchanges ban trading on results days
4. Results often come out while the market is closed

28. Estimates were 2.00 and actual EPS was 2.20. By what percentage did it beat?

1. 10%
2. 20%
3. 0.2%
4. 2.2%

29. Guidance for next year's EPS is cut from 9.00 to 8.10. What percentage cut is that?

1. 9%
2. 10%
3. 0.9%
4. 81%

30. You hold a big position the day before results. What is the careful plan?

1. Remove your stop
2. Buy more because results are usually good
3. Double the size for the news
4. Stay flat or keep the size small enough to survive a gap

31. How is the P/E ratio calculated?

1. Price × number of shares
2. Earnings ÷ revenue
3. Share price ÷ earnings per share
4. Revenue ÷ price

32. A share costs 200 and EPS is 10. What is the P/E?

1. 20
2. 0.05
3. 2,000
4. 10

33. What does a high P/E usually mean?

1. The company is always cheap
2. Investors expect fast growth
3. The company has no shares
4. The price is falling

34. Can a low P/E be a sign of trouble?

1. Only in Japan
2. Only for banks
3. No, a low P/E is always a bargain
4. Yes, it can signal problems as well as cheapness

35. A share costs 120 and EPS is 10. What is the P/E?

1. 0.12
2. 1,200
3. 110
4. 12

36. When is P/E most useful?

1. For companies making losses
2. Comparing crypto coins
3. Comparing a bank with a young tech company
4. Comparing similar companies or a company with its own history

37. Why does P/E not work for a company making losses?

1. There are no earnings to divide by
2. Regulators ban it
3. Loss-making companies have no price
4. P/E only works on weekends

38. Company A has a P/E of 12 and grows profits 3% a year; company B has a P/E of 40 and grows 30% a year. What is the fair reading?

1. B is always overpriced
2. B's high P/E reflects expected growth, so neither is automatically cheaper
3. A is always better value
4. They are identical

39. A stock's P/E is 30 while its own 5-year average is 18. What does that tell you?

1. It is cheaper than usual
2. It is priced higher than usual relative to its profits
3. It must fall tomorrow
4. Its profits doubled

40. A share trades at 500 with EPS of 25. How many years of today's profit are you paying for?

1. 25
2. 12.5
3. 20
4. 500

41. What does P/B compare?

1. Price with revenue
2. Dividend with price
3. Profit with revenue
4. Share price with net assets per share

42. What does P/S compare?

1. The company's market value with its yearly revenue
2. Debt with cash
3. Dividend with profit
4. Price with net assets

43. What is dividend yield?

1. The yearly dividend divided by the share price
2. The number of shares
3. The share price divided by EPS
4. Revenue minus costs

44. Which ratio is often used for banks?

1. Dividend yield only
2. P/B
3. P/S
4. None

45. A share costs 150 and net assets are 100 per share. What is the P/B?

1. 50
2. 1.5
3. 0.67
4. 250

46. Why is P/S useful for a young loss-making company?

1. Banks use it
2. It has a high P/E
3. It still has revenue even without profit
4. It pays big dividends

47. A share at 50 pays a yearly dividend of 2. What is the yield?

1. 25%
2. 8%
3. 4%
4. 2%

48. The price falls from 50 to 25 and the dividend stays at 2. What is the new yield?

1. 8%
2. 12.5%
3. 2%
4. 4%

49. Why can a very high dividend yield be a warning?

1. It means the price is rising
2. It means profits doubled
3. High yields are always safe
4. The market may expect the dividend to be cut

50. A company is valued at 500,000,000 with revenue of 100,000,000. What is its P/S?

1. 50
2. 0.2
3. 400,000,000
4. 5

51. What does a balance sheet list?

1. Its share price history
2. Its daily trades
3. What a company owns and what it owes
4. Only its sales

52. Can a company with a profit run short of cash?

1. Yes, profit on paper is not cash in the bank
2. Only at weekends
3. Only banks can
4. No, never

53. What does the cash flow statement show?

1. Analyst estimates
2. The share price
3. The number of employees
4. The cash that actually came in and went out

54. Why is heavy debt risky?

1. Debt makes profits certain
2. It is illegal
3. Interest must be paid even in bad years
4. Debt removes all taxes

55. Assets are 400 and debts are 300. What is shareholders' equity?

1. 100
2. 300
3. 700
4. 1.33

56. Debt is 300 and equity is 100. What is debt-to-equity?

1. 200
2. 3
3. 0.33
4. 400

57. What is free cash flow?

1. The dividend times two
2. Debt plus equity
3. Revenue with nothing taken off
4. Operating cash flow minus spending on equipment and buildings

58. Debt of 300 has its rate rise from 5% to 8%. What happens to yearly interest?

1. It rises from 15 to 30
2. It rises from 15 to 24
3. It rises from 300 to 324
4. It rises from 5 to 8

59. Two companies each report a profit of 50; one has operating cash flow of 60, the other of 5. Which looks financially stronger?

1. Neither has any cash
2. They are identical
3. The one with 60 of operating cash flow
4. The one with 5

60. Is all debt bad?

1. Only in Japan
2. No, some industries normally carry more debt
3. Only for small companies
4. Yes, always

61. What does CPI measure?

1. The number of shares traded
2. Interest rates
3. How fast consumer prices are rising
4. Total company profits

62. What does GDP measure?

1. Total economic output
2. The number of banks
3. Only exports
4. Stock prices

63. A PMI reading above 50 usually signals what?

1. Contraction
2. Nothing
3. A market holiday
4. Expansion

64. What moves markets most on a release?

1. The gap between the actual figure and the forecast
2. The weather that day
3. The report's font
4. The report's page count

65. How often does the US publish CPI?

1. Every five years
2. Monthly
3. Daily
4. Once a year

66. Forecast inflation is 3.0% and the report shows 3.4%. What is it?

1. In line
2. Hotter than expected by 0.4 points
3. Cooler than expected
4. Hotter by 3.4 points

67. How does the US publish GDP?

1. Every hour
2. Once a decade
3. Weekly
4. Quarterly, with three estimates for each quarter

68. A PMI reading is 47. What does it suggest?

1. No change
2. Expansion, 47 points above zero
3. A 47% rise
4. Contraction, 3 points below 50

69. US CPI comes out at 8:30 New York time. When is that in India while US daylight saving is on?

1. 17:30
2. 18:00
3. 20:30
4. 19:00

70. Why do many traders cut size before a major release?

1. Releases always push prices up
2. Releases never move prices
3. Spreads widen and prices can jump both ways
4. Trading is banned during releases

71. What do central banks set?

1. Share prices
2. Trading hours
3. Short-term interest rates
4. Company profits

72. What does a rate rise usually do to borrowing?

1. Has no effect
2. Makes it free
3. Makes it more expensive
4. Bans it

73. What do higher rates usually do to the economy?

1. Nothing
2. Stop it completely
3. Always boost it
4. Cool it

74. Which is India's central bank?

1. The NSE
2. The Reserve Bank of India
3. The FSA
4. SEBI

75. What does a rate rise tend to do to a country's currency?

1. Turn it into crypto
2. Support it
3. Always crash it
4. Nothing

76. What does a rate rise tend to do to bond prices?

1. Weigh on them
2. Always lift them
3. Freeze them
4. Nothing

77. What often moves markets more than an expected decision?

1. The length of the statement
2. The meeting's location
3. Nothing ever
4. Surprises and hints about future moves

78. A loan of 1,000,000 goes from 5% to 6%. How much more interest is paid each year?

1. 60,000
2. 1,000
3. 10,000
4. 100,000

79. Which stocks tend to be hit hardest by rising rates?

1. Those valued mainly for growth far in the future
2. None, stocks ignore rates
3. All stocks equally
4. Those with no future

80. A central bank holds rates when a rise was widely expected. What is the usual first reaction of its currency?

1. It tends to strengthen
2. It tends to weaken
3. It becomes fixed
4. Nothing can happen

81. What does an economic calendar list?

1. Past trades
2. Company logos
3. Candle patterns
4. Scheduled economic events with times and expected impact

82. Which is usually a high-impact event?

1. A central bank rate decision
2. A new website design
3. A holiday greeting
4. A company's office move

83. Why do many traders cut size around high-impact events?

1. Spreads can widen and prices can jump
2. The law requires it
3. Prices never move then
4. Trading is banned

84. What should you do with event times?

1. Assume they are local
2. Guess
3. Convert them into your own time zone
4. Ignore them

85. US CPI comes out at 8:30 New York time in July. What time is it in India?

1. 19:00
2. 17:00
3. 20:30
4. 18:00

86. You trade USD/JPY. Whose events should you check?

1. Both the US and Japan
2. Only Japan
3. Only the US
4. Only India

87. How many meetings does the Fed's FOMC schedule each year?

1. 12
2. 8
3. 4
4. 52

88. How often does the Bank of Japan hold monetary policy meetings?

1. Once a year
2. 8 times a year
3. Every day
4. Every week

89. An event is at 8:30 New York time in January, when US daylight saving is off. What time is it in India?

1. 20:00
2. 18:00
3. 19:00
4. 17:30

90. A high-impact release is 10 minutes away and you hold a full-size position. What is the careful move?

1. Ignore it
2. Add more
3. Cut size or close before the release
4. Remove your stop

91. What does 'priced in' mean?

1. The news is secret
2. Expected news is already reflected in the price
3. The price is written on a tag
4. The price never changes

92. Can a price fall on good news?

1. Yes, if the good news was already expected
2. Only for crypto
3. No, never
4. Only at weekends

93. Why do markets move before news arrives?

1. Traders act on what they expect
2. Prices are random
3. Exchanges leak news
4. Charts predict news

94. What moves a price most on the day of the news?

1. The time zone
2. The part that was not expected
3. The headline's length
4. The part everyone expected

95. A stock rose from 100 to 125 into an event. By what percentage did it rise?

1. 125%
2. 2.5%
3. 20%
4. 25%

96. Expected bad news is announced, and the price rises. Why can that happen?

1. The news was secretly good
2. Rises are random
3. Charts are wrong
4. The worry was already in the price

97. Surprise good news or expected good news: which usually moves the price more?

1. They always move it the same
2. Neither moves it
3. Expected good news
4. Surprise good news

98. The stock falls from 125 to 115 after the news. What is the fall in percent?

1. 10%
2. 15%
3. 8%
4. 12.5%

99. A stock rose more than 20% in a month before a widely expected event. What is a careful reading?

1. The event will certainly disappoint
2. Nothing is expected
3. Much of the good news may already be priced in
4. It must rise another 20%

100. After a drop on good news, a trader says 'the market is wrong!'. What is the better view?

1. The reaction compared the news with expectations
2. The market ignores news
3. Prices only follow headlines
4. Good news always means up

101. What is a sector?

1. A group of companies in the same kind of business
2. A trading hour
3. A stock exchange
4. A type of candle

102. Which sectors tend to swing more with the economy?

1. Defensive sectors
2. No sectors
3. Only utilities
4. Cyclical sectors

103. Which is an example of a defensive sector?

1. New car sales
2. Everyday goods (consumer staples)
3. Luxury travel
4. House building

104. What does relative strength compare?

1. Two candles
2. Price with volume
3. RSI with MACD
4. A stock's price with its index

105. A stock is at 200 and its index at 10,000. What is the relative strength value?

1. 2
2. 0.2
3. 0.02
4. 50

106. A relative strength line is rising. What does it mean?

1. The stock's price must be rising
2. The stock is doing better than its index
3. The index is falling to zero
4. RSI is above 70

107. Is the business-cycle sector wheel a timetable?

1. Yes, but only for banks
2. Yes, it is exact
3. No, it shows loose tendencies that often break
4. It predicts the date of each stage

108. A stock rose from 200 to 220 while its index rose from 10,000 to 10,200. Which led?

1. The index
2. They were equal
3. Neither moved
4. The stock: +10% against +2%

109. How is relative strength different from RSI?

1. Relative strength only works in crypto
2. Relative strength compares two charts; RSI measures one chart's momentum
3. They are the same
4. RSI compares two stocks

110. In a slowdown, a defensive sector falls less than a cyclical one. What is the careful takeaway?

1. It fits the tendency, but the next slowdown may differ
2. Defensive sectors can never fall
3. Sectors do not matter
4. Cyclical sectors always crash

111. What largely drives currencies?

1. Company dividends
2. P/E ratios
3. Candle colors
4. Interest-rate differences, growth and trade flows

112. What drives commodity prices?

1. Earnings per share
2. Dividend yield
3. Share buybacks
4. Supply and demand

113. Do most coins have earnings to value?

1. Only at weekends
2. Only stablecoins
3. No
4. Yes, all of them

114. Which is a crypto-specific driver?

1. A company's P/E
2. Token supply changes, such as scheduled unlocks
3. Crop weather
4. Tokyo's lunch break

115. When is the US weekly petroleum report normally released?

1. Every day at noon
2. Wednesdays at 10:30 New York time
3. Once a year
4. Mondays at 9:15 India time

116. Country A's rate is 5.25% and country B's is 0.50%. What is the rate gap?

1. 4.75 points
2. 0.25 points
3. 5.75 points
4. 10.5 points

117. Why don't stock ratios like P/E fit a currency?

1. A currency has no earnings per share
2. Currencies are too small
3. P/E only works on Fridays
4. Regulators ban it

118. Analysts expected oil inventories to fall by 2 million barrels, but they rose by 3 million. What is the surprise?

1. 1 million barrels
2. No surprise
3. 3 million barrels less
4. 5 million barrels more than expected

119. A surprise rise in oil inventories tends to do what to the oil price?

1. Weigh on it
2. Always double it
3. Nothing
4. Turn it negative

120. A country's rate gap over another widens in its favour. What tends to happen to its currency?

1. It stops trading
2. It tends to weaken
3. It tends to strengthen
4. It becomes fixed

121. Where does a top-down check start?

1. With the profit you want
2. With the smallest candle
3. With a random tip
4. With the big picture: rates, economy and sector

122. What do fundamentals help explain?

1. The exact entry price
2. The candle color
3. Why a market might move
4. The broker's fees

123. What does the chart help decide?

1. Central bank policy
2. Entry, stop, target and size
3. Company profits
4. The economy's growth rate

124. News and chart disagree. What do many traders do?

1. Trade smaller or wait
2. Trade without a plan
3. Remove the stop
4. Double the size

125. What is the right order of the funnel?

1. Chart, plan, economy, market, sector
2. Market, plan, economy, chart, sector
3. Plan, chart, market, sector, economy
4. Economy, sector, market, chart, plan

126. A strong news story says the price must rise, but your stop is hit. What should you do?

1. Add to the position
2. Ignore the stop because the news is strong
3. Move the stop lower
4. Respect the stop

127. Why use a written checklist?

1. It predicts the news
2. It makes every trade win
3. It keeps the order the same every time
4. It replaces the stop

128. Normal risk is 100 and the checklist says halve it. With a stop 2.50 away, how many shares?

1. 250
2. 50
3. 20
4. 40

129. A trader enters on a chart signal, then searches for news to support the trade. What is the mistake?

1. Using a stop
2. Using fundamentals to justify a trade after entering
3. Checking the calendar
4. Sizing the trade

130. The trend is up and the rate news supports it, but a high-impact release is 10 minutes away. What fits the checklist?

1. Wait for the release or trade smaller
2. Skip the stop
3. Enter full size now
4. Trade twice as big