Follow a stock trade from quote to exchange: test your skills
Companies raise money once; after that, shares change hands between investors on exchanges. Answer each question to see the explanation; your score appears at the end.
This test checks that you can
- Tell the primary and secondary markets apart
- Explain bid, ask and spread
- Choose between market and limit orders
- Practice
1. When you buy a share on an exchange from another investor, the company receives…
- Practice
2. The spread is…
- Practice
3. A limit order…
- Key idea
4. Which statement best explains "Companies raise money once"?
- Key idea
5. Which statement best explains "Price is agreement"?
- Key idea
6. Which statement best explains "Limits protect price"?
- Action plan
7. In the action plan, which step comes first?
- Mistake to avoid
8. Which of these is a mistake this lesson warns against?
- Mistake to avoid
9. Which of these is a mistake this lesson warns against?
Bid $19.90, ask $20.10. You buy 50 shares at the ask and immediately sell at the bid. What did the spread cost you?
Show the answer
$10
Spread $0.20 × 50 shares = $10.
Look up any widely traded fund’s quote and calculate its spread.
More tests in this bootcamp
- What is a stock? Understand ownership and risk
- Compare common and preferred shares
- Follow a stock trade from quote to exchange
- Measure company size with market capitalization
- Read dividend yield without mistaking it for a promise
- Decode the P/E ratio: price compared with profit
- Understand growth and value investing styles
- Follow an IPO from offer price to public trading
- Tell a stock split from share dilution
- Understand market rises, falls and recovery math
- Final exam: Stocks and the market