Analysis Beginner: Analyzing Investments

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
Technical analysts rely heavily on company balance sheets to predict price movements.
Choose wisely. There is only one correct answer.
False. Technical analysts do not use any fundamental company information, such as balance sheets, to make their predictions.
2.
When investor expectations are high, the overall market will _______.
Choose wisely. There is only one correct answer.
Fall. When investor expectations are high, the overall market will fall.
3.
Fundamental analysts use a corporation's financial information to determine its stock's intrinsic value.
Choose wisely. There is only one correct answer.
True. Fundamental analysts are concerned with the state of the company.
4.
The main information source for fundamental analysis is the cash flow statement.
Choose wisely. There is only one correct answer.
False. The main information source for fundamental analysis is the balance sheet.
5.
The main goal of security analysis is to _______.
Choose wisely. There is only one correct answer.
Calculate the real value of a security. The main goal of security analysis is to calculate the real value of a security.
6.
An upward trend that shows a reversal pattern will _______.
Choose wisely. There is only one correct answer.
Go down. An upward trend that shows a reversal pattern will go down.
7.
A high debt-to-equity ratio is an indicator of low risk.
Choose wisely. There is only one correct answer.
False. A high debt-to-equity ratio is an indicator of high risk. It means the company is carrying a lot of debt relative to equity.