1. What does the Sharpe Ratio measure? Risk-free return Portfolio diversification Risk-adjusted return Beta-neutral return

2. What is gamma in options trading? Rate of change of delta Premium paid Time decay Risk-free return

3. In algorithmic trading, what is slippage? System lag Loss due to taxes Difference between expected and actual trade execution price Overtrading

4. What is a ‘straddle’ strategy in options trading? Selling naked calls Buying call and put at same strike price Hedging with futures Shorting equity

5. What is dark pool trading? Illegal trading Trading with government bonds Institutional trades not visible to public until executed Pre-market orders

6. What does the 'Greeks' in options refer to? European traders Market indexes Sensitivities of option price to variables Mutual fund terms

7. What is the Kelly Criterion used for? Calculating brokerage Maximizing portfolio diversification Position sizing based on probability Estimating volatility

8. What is the Efficient Market Hypothesis (EMH)? Markets reflect all info; beating it is impossible Markets are inefficient and easy to beat Only big investors can profit Charts always predict future

9. What is a Quant Fund? Fund based on sector performance Mutual fund managed by humans Fund driven by mathematical and statistical models Fund investing in bonds only

10. What is the implied volatility in options pricing? Predicted price of the stock Company’s financial performance Market’s expectation of future volatility Strike price

11. What is the role of backtesting in trading systems? Predict government policy Simulate past performance of a strategy Check investor emotions File income tax

12. What is high-frequency trading (HFT)? Monthly investing Buy & hold strategy Automated trading executing many orders in milliseconds Insider trading

13. What is meant by ‘drawdown’ in portfolio management? Profit percentage Number of stocks Peak-to-trough decline in portfolio value Amount of investment

14. What does delta hedging aim to achieve? Protect against interest rate risks Reduce portfolio fees Offset directional risk in options Increase leverage

15. What is the Black-Scholes model used for? Calculating inflation Predicting market crashes Valuing options Measuring NAV

16. What does the term “alpha generation” refer to? Capturing dividend Beating the benchmark return Buying blue-chip stocks Asset allocation

17. What is a synthetic position in derivatives? Direct stock purchase Combination of options mimicking another position Investing in commodities Currency hedging

18. What is “contango” in futures markets? Spot price > futures price Futures price > spot price Market shutdown Margin call situation

19. What is a Monte Carlo simulation used for in finance? Rolling dice in Vegas Visualizing candlesticks Risk and probability modeling Brokerage fee estimation

20. What is the purpose of a “stop-limit” order? Prevent insider trading Stop buying stocks Trigger order at stop price, but execute only at limit price Margin stop

21. What is convexity in bond investing? Shape of yield curve Sensitivity of bond price to interest rate changes Coupon payment style Duration of debt

22. What is a leveraged ETF? Fund using options ETF that amplifies returns using borrowed funds Low-risk investment Long-term fixed-income fund

23. What is an index rebalancing event? Dividend distribution Realigning weightage of stocks in an index Day trading Government audit

24. What is “theta decay” in options? Increase in volatility Change in strike price Loss of option value due to time Risk-free return

25. What is cross-currency arbitrage? Investing in one country Hedging bond portfolios Exploiting price differences in forex rates Commodity trading

26. What is portfolio beta of 1.5 interpreted as? No risk 50% less volatile than market 50% more volatile than market Negative correlation

27. What is “pair trading”? Long two stocks in same sector Short one stock, long another in a correlated pair Buying ETFs Options strangle

28. What is an inverted yield curve a predictor of? Bull market Economic expansion Recession Interest hike

29. What is ‘rebalancing drift’? Trader error Excess trading cost Deviation of portfolio weights from targets over time Over-diversification