Zerodha Varsity Stock Market Basics Intermediate Answers

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Zerodha Varsity Stock Market Basics Intermediate Answers

Q1. What triggers the movement in the stock on a daily basis?

  1. News
  2. Events
  3. Demand and Supply
  4. All the above

Q2. To buy a stock for delivery, which of the following accounts is required

  1. A bank account
  2. A DEMAT account
  3. Trading account
  4. All of the above

Q3. You become a part owner of a business when you buy shares of a company.

  1. True
  2. False

Q4. What is ‘holding period’, with respect to an investment?

  1. The tenure during which you hold an investment
  2. Tenure of the investment starting on a 2 T+2 basis
  3. The holding period reflects the current value of an investment
  4. None of the above.

Q5. What is the return on investment when you buy a stock today at 125 and sell the same at 145 a year later?

  1. 16%
  2. 15.5%
  3. 10%
  4. 17%

Q6. When you measure returns over two years, you should opt for-

  1. Absolute Return
  2. Compounded annual growth rate (CAGR)
  3. Either absolute or CAGR
  4. This return cannot be measured

Q7. What does the stock market index indicate?

  1. Indicates the overall performance of the stock market
  2. Indicates how a certain section of the 2 economy is performing
  3. Indicates how all the larger companies of the economy are performing
  4. None of the above

Q8. How many companies are there in the Nifty and the Sensex index respectively?

  1. 49 and 29
  2. 51and 31
  3. 50 and 30
  4. Keeps changing every quarter

Q9. Which of these is an application of an Index?

  1. Trading
  2. Parttolio hedging
  3. Benchmarking
  4. All of the above

Q10. Which best describes a sector-specific index?

  1. An index vwhich tracks the wold economy
  2. An index to exclusively track the price performance of a sector-specific portfolio
  3. Nifty and Sensex are both sector specific
  4. An index to track agricultural and industrial output

Q11. 52 week low of a stock is

  1. The price at which the stock is currently trading
  2. The lowest price at which the stock has traded for the last 1 year
  3. When the stock price hits Rs.52
  4. The price at which the stock opens

Q12. TCS announces a dividend of Rs.50. The face value is Rs1, what is the dividend percentage?

  1. 50%
  2. 500%
  3. 5000%
  4. 45%

Q13. You short a stock at 75, for you to make a profit, the stock should

  1. Move higher than 75
  2. Stay at 75
  3. Move higher than 75 but lower than 80
  4. Go to any price lower than 75

Q14. To square off an short trade, you need to-

  1. Buyback the same quantity of the stock
  2. Sell the stock
  3. Buy first and then again sell it
  4. Sell first and then buy again

Q15. The volume represents both the buy and the sell transaction

  1. True
  2. False- Only buy transactions are considered in calculating volumes

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