Stock Jobs Stock Market Liquidity 4

Question 1

A dark pool is a trading venue designed primarily to do what?

Accepted Answer

Execute large orders with reduced market impact

Answer

Publish all quotes in real time

Answer

List only penny stocks

Answer

Replace stock exchanges entirely

Question 2

Which of these typically reduces a stock's liquidity?

Accepted Answer

A small public float

Answer

A stock split increasing share count

Answer

Index inclusion

Answer

High institutional and retail interest

Question 3

The Amihud illiquidity ratio measures liquidity by relating price change to what?

Accepted Answer

Trading volume

Answer

Dividend yield

Answer

Earnings growth

Answer

Market capitalization alone

Question 4

When a stock is added to a major index like the S&P 500, its liquidity usually does what?

Accepted Answer

Increases due to fund buying and attention

Answer

Decreases sharply

Answer

Stays exactly the same

Answer

Becomes irrelevant

Question 5

Which is a benefit of high liquidity for everyday investors?

Accepted Answer

Tighter spreads and easier entry/exit

Answer

Guaranteed price appreciation

Answer

Higher dividends automatically

Answer

Exemption from taxes

Question 6

A 'flight to liquidity' during market stress means investors move toward what?

Accepted Answer

Highly liquid, safe assets

Answer

Illiquid micro-cap stocks

Answer

Real estate only

Answer

Long-dated junk bonds

Question 7

Why might a halt in trading temporarily eliminate liquidity for a stock?

Accepted Answer

No orders can be executed while trading is paused

Answer

It permanently delists the stock

Answer

It forces all holders to sell

Answer

It doubles the share price