Interview Questions.

Question 1. What Is An Exchange?

Answer :

Exchange – An exchange is a exceedingly organized marketplace where (mainly) tradeble securities, commodities, forex, futures and alternatives contracts are bought and acquired. Exchange brings collectively brokers and dealers who purchase and sell those items.

Examples of exchanges are Bombay Stock Exchange, NeyWork Stock Exchange (NYSE), Tokyo Stock Exchange (TSE)

Question 2. What Is The Difference Between A Stock And A Bond?

Answer :

Stock is fairness instrument whilst Bond is debt asset. Since fairness is greater risky related to Market Risk it could offer more returns at the same time as Bond is fairly more secure tool so it offer predefined hobby known as “coupon” even though Bond is also related to Counter Party Risk.

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Question three. What Is The Difference Between Sell Orders And Short Sell Orders?

Answer :

Sell manner promoting your personal securities , short selling manner selling securities with out owning them typically broker lend securities to user.There are  sorts of short promote e.G. Covered Short Sell and bare Short Sell, maximum of the inventory exchanges doesn’t permit bare quick sell due to the fact its generally abused to take stock price downward.

Question four. What Is Naked Short And What Is Covered Short?

Answer :

Naked brief is whilst dealer sells one stock which they don’t very own at that moment. Covered Short Sell means that dealer owns stock which they may be shorting.

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Question 5. What Is The Difference Between An Ecn And An Exchange?

Answer :

ECN is an Electronic Communication Network ,An electronic gadget that tries to remove the function of a third birthday party inside the execution of orders entered with the aid of an alternate market maker or an over the counter market maker, and lets in such orders to be absolutely or partially executed.

An ECN connects essential brokerages and person traders with a purpose to exchange without delay among themselves while not having to undergo a middleman. Sometimes ECNs also are referred as darkish pool.

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Question 6. What Is Financial Information Exchange (restoration) Protocol ?

Answer :

The Financial Information alternate (FINANCIAL INFORMATION EXCHANGE (FIX)  protocol is an electronic communications protocol for international real-time trade of records associated with securities transactions and markets. Most of the digital buying and selling is carried out in FINANCIAL INFORMATION EXCHANGE (FIX)  , even though extraordinary exchanges has there own native protocol however maximum of the dealer supports FINANCIAL INFORMATION EXCHANGE (FIX)  protocol.

Question 7. What Is Limit Order?

Answer :

As according to FINANCIAL INFORMATION EXCHANGE (FIX)  protocol A restrict order is an order to shop for a protection at no greater  than a selected Price (can be offered decrease fee) or promote at no longer much less than a particular charge (can be bought at higher charge). This offers the customer a few manage over the fee at which the alternate is executed, however might also save you the order from being executed. A restrict orders may be accomplished at on rate or better charge.

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Question 8. What Is A Market Order?

Answer :

In FINANCIAL INFORMATION EXCHANGE (FIX) protocol a market order is a buy or sells order to be achieved by using the dealer without delay at modern marketplace expenses. This may want to prove very dangerous in phrases of price because it doesn’t care at what charge its buying or selling securities.

Question 9. What Is A Stop Or Stop Loss Order?

Answer :

In FINANCIAL INFORMATION EXCHANGE (FIX)  protocol A stop order ( also stop loss order) is an order to buy ( or sell) a protection as soon as the rate of the security has reached  above ( or fall under) as unique prevent rate. When the desired stop rate is breached, the stop order is entered as a marketplace order ( no restrict).

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