Test Your Trading Potential

    
1. What is the probability of the first business day of the month being Monday?

   
2. In a poker game each player is dealt with 5 cards. Straight Flush (5 suited consecutive cards) is valued higher than Four of a Kind.  However there are total 36 possible combinations for a Straight Flush in a deck of cards and only 13 combinations for Four of a Kind. Why is Straight Flush valued higher than Four of a Kind? Please support your answer with calculations

   
3. It is a known fact that on average, for any trader, 60% of his trades lose money.  Why are there still so many traders and which strategies differentiate a successful trader?

   
4. ICE Brent futures market prices increased from 50 $/bbl to 51 $/bbl over the past five days. Over the same period of time the Nymex WTI market rose from 60 $/bbl to 65 $/bbl.  Which one of these two markets is more volatile and why?

   
5. There are 100 people in one room each of whom is in possession of 2 pencils (200 pencils total) and there 10 people in a different room with 10 pencils owned by each person (100 total) In which room will it be easier to determine fair price for a pencil and where will it be easier to buy 20 pencils at once? Which market characteristics explain your answers?

   
6. At a certain point of time market indications for currency rates look as follows:

 

Currency               USD                 GBP                 EUR

USD                                              0.645               0.833

GBP                       1.55                                        1.25

EUR                       1.20                 0.80

What does it tell you? Which market characteristic you can use for your trading ideas?

   
7. There is a clear relationship between the oil and equity markets over the past several years.  Originally there was an inverse relationship but lately it has turned around to a direct one.  Please analyze such relationship.

   
8. Red frog sits in a blue box on a speed train moving at 200 km per hour. Every two seconds, the frog doubles in size.  At exactly 1 minute after stopping at a red light, the frog reaches the size of the box.  At what point of time was the frog a quarter of the size of the box?

   
9. Three traders would like to know their average bonus (the average bonus of these 3 traders). How can they do it, without discussing their own actual bonus?

   
10. In Micronesia, there are 5000 different names made up of 4 letters, 3,000 with 3 letters symbols, and 400 with 2 letters. How many names do you estimate there are made up of one letter?

   
11. The difference between today's price of copper for delivery today and  today's' price for delivery in three months can be either positive (today's price higher than that for 3 months) or negative (today's price lower than that of a 3 month price). Is there a limit on how large the positive or negative differences can be? Why?

   
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