Welcome to your Jargon Buster Quiz. This is a formative learning exercise to ensure you have the foundations to complete JT+ Good luck and do your best! Feel free to use your Jargon Buster Handbook to help you answer the questions. Name Email 1. An open economy is one that: Controls all production Has fixed interest rates Restricts imports Trades freely with other countries None 2. A bond that can be converted into company shares is: Irredeemable Gilt Preference Share Convertible Bond Floating Rate Note None 3. A call option gives the holder the right to: Redeem bonds Buy an asset Receive dividends Sell an asset None 4. Yield is best described as: Dividend only Interest only Total capital growth Income expressed as a percentage of price None 5. An ETF differs from a unit trust because it: shares traded on an exchange is: Cannot hold equities Trades on an exchange Is closed ended only Is unregulated None 6. The FTSE All Share Index represents approximately: Only technology companies 98 percent of UK listed shares by value Top 100 shares only Top 250 shares only None 7. An investor expecting falling market prices is described as: Bear Leveraged Bull Long None 8. The spread in financial markets refers to: Difference between bid and offer price Dividend growth Yield to maturity Coupon difference None 9. A SICAV is: European open ended investment vehicle Corporate bond Government regulator Closed ended trust None 10. NAV is particularly important for pricing: Derivatives Corporate bonds Investment trusts only OEICs and unit trusts None 11. Passive management aims to: Avoid equities Time the market Outperform the market Replicate a benchmark index None 12. Stamp Duty Land Tax applies primarily to: Share purchases Dividend payments Property purchases Bond redemptions None 13. A redemption date refers to: IPO launch Tax deadline Bond maturity date Dividend payment day None 14. Private Markets primarily involve investments that are: Guaranteed by governments Traded daily on stock exchanges Limited to property Not traded on public stock exchanges None 15. An incentive often associated with investing in a VCT is: Tax relief Guaranteed capital Fixed dividends Zero risk None 16. Volatility measures: The degree of price variation over time Interest rates Dividend payments Company profits None 17. The Consumer Prices Index measures: Exchange rates Inflation Share price growth Corporate profits None 18. Which regulator is responsible for prudential regulation of deposit taking institutions? HM Treasury ESMA FCA PRA None 19. An instrument issued at a discount and redeemed at par without paying coupons is: Preference Share Convertible Bond Floating Rate Note Zero Coupon Bond None 20. One potential risk associated with algorithmic trading is: Lower liquidity Rapid market volatility Human error only Guaranteed losses None 21. A closed ended fund is typically structured as: Unit Trust Investment Trust OEIC ETF None 22. Fiscal policy refers to: Bond yields Taxation and government spending IPO pricing Interest rate decisions None 23. Liquidity risk refers to: Inflation Borrower default Falling dividends Difficulty selling at a fair price None 24. Over the counter trading refers to transactions conducted: Away from an exchange Only in futures markets Through SETS On the London Stock Exchange None 25. A put option gives the holder the right to: Convert bonds Issue shares Buy an asset Sell an asset None 26. SONIA stands for: Securities Overnight Interest Allocation Standard Overnight Interbank Agreement Sterling Overnight Index Average Sterling Official Investment Average None 27. An Initial Public Offering is: A bond redemption A secondary market trade A rights issue A new issue of shares None 28. Artificial Intelligence (AI) is increasingly used in financial services to: Print physical banknotes Analyse large amounts of data and identify patterns Guarantee investment returns Replace all human investment managers None 29. Settlement (T+2) means that a trade is completed: Two weeks after execution On the same day Two minutes after execution Two business days after execution None 30. Private Credit refers to Credit card lending only Lending that takes place outside public debt markets Government borrowing through Gilts Lending exclusively by banks None 31. Credit risk refers to: Interest rate changes Market volatility Liquidity shortage Borrower failing to repay None 32. An out of the money call option has: An exercise price above market price No premium Guaranteed profit An exercise price below market price None 33. Quantitative Easing (QE) involves a central bank: Raising taxes Selling shares to investors Creating money to purchase financial assets Setting dividend policy None 34. A gilt edged security is: Preference share Corporate bond UK government bond ETF None 35. Which body sets UK base interest rates? Bank of England via MPC Financial Conduct Authority Prudential Regulation Authority HM Treasury None 36. A tracker fund differs from an ETF because: It cannot hold equities It is unregulated It may not trade on an exchange It is always closed-ended None 37. A floating exchange rate is determined primarily by: Dividend policy Government decree Market supply and demand Tax law None 38. The term ex dividend means: Buyer will not receive next dividend Buyer will receive next dividend Dividend has been increased Dividend is guaranteed None 39. A gross redemption yield takes into account: Dividend growth only Only coupon payments Interest payments and capital gain or loss Only capital gains None 40. The balance sheet shows: Assets, liabilities and equity Company profits only Dividend history Share price movements None 1 out of 1 Thanks for completing the quiz. You will receive your result soon.
