7
Concepts
3
Formulas
1
Decisions
3
Quiz Questions
7 concepts covered in this module.
Achieve purposes: save, borrow, raise equity, manage risk, exchange assets, trade on information.
Securities (stocks, bonds), Currencies, Commodities, Real assets, Contracts (forwards, futures, options, swaps).
Brokers (match buyers/sellers), Dealers (trade from inventory), Exchanges (organized markets), ATS (dark pools).
Borrow and sell security, buy back later. Profit if price falls. Unlimited loss potential. Margin requirements apply.
Margin buying: borrow to buy securities. Amplifies both gains and losses. Margin call if equity falls below maintenance.
Market (execute immediately at best price), Limit (specify max buy/min sell price), Stop (triggered at price level).
Prices reflect all available information. Weak (past prices), Semi-strong (public info), Strong (all info including private).
3 essential formulas for this module.
Where: Higher leverage = more risk and potential return
Where: For long positions
Where: Leveraged return
1 decision frameworks to guide your analysis.
Visual overview of how concepts connect in this module.
This module has 11 flashcards and 3 quiz questions to test your knowledge.
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