Can you answer the questions below?
Question 1:
If you own 100 shares of a company's stock that is trading at $40 a share and the company declares a four-for-one stock split, the stock will now be trading at ___________ and you will own ________shares.
Select Your Answer:

1. $160, 25
2. $10, 400
3. $10, 25

Think that question is easy? Try this one!

Question 2:
Envelopes are also known as _____ and are used to _______.

1. Bollinger Bands, measure volatility
2. Gann Angles, show trend lines of support and resistance.
3. Trading Bands, show the limits of a security's trading range

Do you know the answers? Don't cheat and look ahead! The answers (and explanations) are at the bottom of this article. These questions are just an example of what you can learn in the all new Knowledge Center.

No matter if you are a new investor or an expert trader, you'll find information you can use. The Knowledge Center includes everything from basics such as investment risk, asset allocation and retirement accounts to advanced topics such as technical analysis and customizing charts. The Knowledge Center is fully customizable - so you can decide what topics you would like to view on the overview page and arrange the topics how you want to see them.

To access the Knowledge Center:

• On Scottrade.com - click the Knowledge Center tab at the top of the page
• On Scottrader - click the yellow Knowledge Center link in the upper right corner
• On ScottradeELITE - click the Help button at the top of the ScottradeELITE window

After accessing the Knowledge Center, you can search for a specific topic or navigate through different areas using the left column navigation. There are educational topics such as Investment Basics and Retirement Planning to Scottrade-specific help such as how to enter a stock order, set up a watch list or deposit funds into your account.

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The Knowledge Center can be accessed by the "Knowledge Center" tab at the top of your account on the Web site.

Other features of the Knowledge Center include a bookmarking feature that allows you to create your very own "Reference Notebook" to save topics of interest to revisit at a later date and a Media Center that includes webcasts, tutorials, quizzes and other interactive features. In addition, you can access the Scottrade Online Community and sign up for live educational events directly from the Knowledge Center.

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The Media Center gives you access to webcasts, tutorials, games and other interactive features.

We will be continually adding topics, so let us know if there is something you would like to learn more about. And, of course, if you have any questions feel free to contact your local Scottrade branch office.

Question 1 Explanation
Correct Answer: B

If a stock is trading at $40 a share and the company declares a four-for-one stock split, you'll receive four shares for every share of stock you own. At the same time, the value of each share is divided by four. If you originally owned 100 shares, you'd now own 400 shares trading at $10 a share after the split.

The market value of your holding is the same before and immediately after the split. So, in this example, your shares would be worth $4,000 either way. However, after the split is finalized, the share price could either increase or decrease, which would affect market value.

Question 2 Explanation
Correct Answer: C

Envelopes, also known as Trading Bands, are used to show the upper and lower limits of a security's normal trading range. The indicator is composed of two bands between which 90% of price activity should be contained.

Bollinger Bands help measure volatility and are created using three lines. The first represents a security's average price over a fixed period of time. The second and third lines are each two standard deviations away from the first. Changes in price will cause the two outer bands to contract or spread out, showing a decrease or increase in volatility.

Gann Angles, which are also known as Fans, are used to show trend lines of support and resistance. To create the most significant angle - 1x1 or 45 degrees - a line is drawn from the intersection of the x- and y-axes of a chart, where time is on the x-axis and price is on the y-axis. Units of price must equal units of time. There are nine significant Gann angles.