Series 6 Unit 4 Review

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Across
  1. 4. These types of industries are least affected by normal business cycles. These types of stock generally decline less than others in contractionary periods. Examples: food, tobacco, alcohol, utilities
  2. 5. Strategic asset allocation is considered a ________ management style, as conditions for rebalancing tend to be slow moving and more predictable
  3. 7. This is the movement of money invested in stocks from one industry to another as investors and traders anticipate the next stage of the economic cycle.
  4. 9. This is the risk that government actions will constrain a corporation or industry, thereby adversely affecting an investor's holdings in that company or industry.
  5. 10. The extent to which an asset's actual return exceeds or falls short
  6. 13. This type of risk is also known as credit risk, it is the risk that a lender takes on in the chance that a borrower will be unable to make the required payments on their debt obligation
  7. 14. Capital _______ refers to an increase in an investment’s value over time.
  8. 16. age, marital status, and employment are all this type of customer investment consideration
  9. 19. A measure of a stock's volatility in relation to the overall market
  10. 21. ______ statement questions will help lead to an understanding of a customer’s cash flow.
  11. 22. If an investment goes up less than beta it has a _________alpha
  12. 24. _______ risk is the potential of loss of part or all of an investment.
  13. 27. ______ risk is another name for credit risk
  14. 29. _______ describes the relationship between systematic risk, or the general perils of investing, and expected return for assets, particularly stocks. It is a finance model that establishes a linear relationship between the required return on an investment and risk.
  15. 30. ________ appear on a company’s balance sheet in order of liquidity
  16. 32. This is a practical method for selecting investments in order to maximize their overall returns within an acceptable level of risk.
  17. 33. Property, plants and equipment are considered _______ assets, items that are not easily converted into cash
  18. 37. This risk is the chance that a national government's treasury or central bank will default on their commercial debt
  19. 41. A _______ alpha is more desirable
  20. 42. This type of asset class includes subclasses based on market capitalization, value versus growth, and foreign equity
  21. 43. ________ asset allocation refers to the proportion of various types of investments composing a long-term investment portfolio.
  22. 44. ______ risk is the possibility of a loss resulting from a borrower's failure to repay a loan or meet contractual obligations.
  23. 46. These industries are highly sensitive to the business cycle and inflation trends. Typical products within this industry are considered durable goods. During recessions, demand tends to decline.
  24. 47. ______ ______ is the investment strategy a customer will use who wants to generate additional money
  25. 48. ____________ analysis involves an inspection of a company’s revenues, expenses, debt levels, product and/or service lines, and management.
Down
  1. 1. ______ of capital is the investment strategy that customers who are looking for safety will use
  2. 2. ________ _______ questions will help determine a customer’s circumstances and help on understanding their investing history
  3. 3. The exposure a company or organization has to factor(s) that will lower its profits or lead it to fail. Anything that threatens a company's ability to achieve its financial goals is considered a _______ risk.
  4. 6. An industry in the growth phase is growing _____ than the economy as a whole
  5. 8. _______ asset allocation involves deviating away from the longer term strategic asset allocation plan for short periods of time. This is most often done to take advantage of short term opportunities or to shelter the portfolio from short term risk.
  6. 11. Securities listed on an exchange, Nasdaq stocks or bonds, mutual funds or publicly-traded REITs would be good investments for a customer looking for ________
  7. 12. This type of risk refers to the possibility that an investor will be unable to reestablish cash flows (e.g., coupon payments) at a rate comparable to their current rate of return.
  8. 14. This type of management style involves picking a series of individual securities with an overall goal of “beating the market.”
  9. 15. MPT holds that specific risks can be diversified away by having a portfolio consisting of securities whose returns are not ___________
  10. 17. This type of asset class focuses on the 13-week T-bill and other short-term money market instruments
  11. 18. A security or portfolio with a beta less than 1.0 is generally going to be ______ volatile than the overall market
  12. 20. __________ is an asset that has a finite monetary value and usually a physical form.
  13. 23. Asset ________ allocation refers to the spreading of portfolio funds among different asset classes
  14. 25. This type of asset class includes subclasses based on maturity and issuer
  15. 26. Companies that retain most of their earning to finance their business expansion can be described as being in this type of industry
  16. 28. _____ risk explains the potential for missing out on beneficial movements in price due to an error in timing. This could cause harm to the value of an investor's portfolio resulting from purchasing too high or selling too low.
  17. 31. This type of risk affects the overall market, not just a particular stock or industry and is both unpredictable and impossible to completely avoid
  18. 34. Don’t put all your eggs in one basket. It is a risk management technique that mixes a wide variety of investment within a portfolio, thus minimizing the impact of any one security on overall portfolio performance
  19. 35. _____ capital is a company’s current assets minus its current liabilities
  20. 36. ______ assets include all cash and other items expected to be converted into cash within the next 12 months
  21. 38. This risk describes the risk involved with the premature return of principal on a fixed-income security. When debtors return part of the principal early, they do not have to make interest payments on that part of the principal
  22. 39. These industries tend to turn down as the economy heats up and rise when the economy turns down. Examples of these industries are gold and gold mining stock
  23. 40. ______ risk is another name for credit risk
  24. 42. Options contracts, DPPs, high-yield bonds, unlisted/non-Nasdaq stocks or bonds, commodities and futures are good investments for someone with this as an investment strategy
  25. 45. A security or portfolio with a beta greater than 1.0 is generally going to be ______ volatile than the overall market