Finra Series-7 Exam - Topic 3 Question 74 Discussion

Actual exam question for Finra's Series-7 exam

Question #: 74
Topic #: 3

[All Series-7 Questions]

The market theory stating that the small investor is usually wrong is called the:

Aadvance-decline theory

Bodd-lot theory

CDow theory

Dshort interest theory

Show Suggested Answer

Suggested Answer: B

The market theory stating that the small investor is usually wrong is called the odd-lot theory. The concept behind this theory is that when small lot sales are high, it is a good time to buy, as a high ratio of small business sales is a contrary indicator of market direction.

by Rasheeda at Sep 01, 2023, 05:33 PM

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Mickie

7 months ago

I always thought it was just a myth!

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Jestine

7 months ago

Agreed, odd-lot theory makes sense here.

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Francis

8 months ago

Really? Small investors are usually wrong? Sounds fishy.

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Franchesca

8 months ago

I thought it was the Dow theory.

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Alison

8 months ago

It's definitely the odd-lot theory!

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Brock

8 months ago

I’m torn between odd-lot theory and advance-decline theory. I wish I had reviewed those concepts more before the exam!

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Elke

8 months ago

I feel like I’ve seen a question like this before, and I think it was about odd-lot theory. It’s definitely not Dow theory, though.

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Nydia

9 months ago

I remember studying something about small investors being wrong, but I can't recall if it was odd-lot theory or something else.

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Olga

9 months ago

I think the answer might be odd-lot theory, but I'm not completely sure. It sounds familiar from my notes.

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Aleshia

9 months ago

I'm confident the answer is B, the odd-lot theory. That's the market principle that says the small investor is usually on the wrong side of the trade.

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Alishia

9 months ago

I've seen this concept before, but the wording of the question is tripping me up a bit. I'm leaning towards the odd-lot theory, but I want to make sure I'm not missing something in the other options.

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Jacquline

9 months ago

Okay, let me break this down. The small investor being wrong is the key part of the question. I think that points to the odd-lot theory, but I'll double-check the definitions just to be safe.

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Macy

9 months ago

Hmm, I'm not totally sure about this one. I'll have to think it through carefully. The options seem a bit similar, so I want to make sure I understand the differences.

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Lenny

9 months ago

I'm pretty sure this is the odd-lot theory, where the small investor is usually wrong. That's a classic market principle.

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Angella

9 months ago

I'm drawing a blank on the name of this theory. I'll have to make an educated guess based on the options provided.

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Clemencia

9 months ago

The odd-lot theory, that's the one! I remember learning about that in class. Small investors are usually wrong, so that's the market theory they're referring to.

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Whitney

9 months ago

Okay, let me think this through. The question is asking about a market theory related to small investors, so I'm going to carefully read through the options and see which one fits best.

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Sylvie

9 months ago

Hmm, I'm a bit unsure on this one. I know it has something to do with small investors, but I can't quite remember the specific theory name.

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Magda

9 months ago

This one seems pretty straightforward. I'm pretty sure the answer is the odd-lot theory.

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Catarina

9 months ago

Hmm, I'm a little unsure about the picture bullet part. I'll need to read through that section a few times to make sure I understand the process.

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Pauline

9 months ago

This question seems straightforward, I think I can handle it.

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Shannan

9 months ago

Okay, I've got this. The key is to focus on the information that would provide insights into the current state of the Finance Directorate's workforce. Levels of absenteeism, staff turnover, and identification of staffing shortages or excess - those are the three I'll go with.

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