Series 65 Exan - Series 65 Exam Question

Here is a great series 65 exam question

What does a proponent of fundamental analysis use to value common stock?


I. Trade volume

II. Discounted Cash Flow

III. P/E ratio

IV. Moving price average
 
A) I and III
 
B) II and IV
 
C) II and III
 
D) I and IV
 
Answer: C
 
The correct answers are II and III. A fundamental analyst would look at the financial make up of the company and how that financial value of the company is priced in the market place. Of the choices listed a fundamental analyst would use a discounted cash flow method which would be used to place a current value on the company's future earnings and a P/E ratio which would tell the analyst what people are paying in the market place for those earnings on a per share basis. Moving averages and trade volume would be used by an investor interested in technical analysis.
 
take some free series 65 exam questions on our site at:
 
http://www.securitiesce.com/web/pages/series65/index.php