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Investing in Stocks and Bonds
Terms about investing in stocks and bonds
Terms in this set (45)
A prolonged period of falling prices and a general feeling of investor pessimism.
blue chip stocks
Stocks of large, well-established comporations with a solid record of profitability.
A prolonged period of rising stock prices and a general feeling of investor optimism.
An increase in the value of stock above the price initially paid for it.
A type of stock that pays a variable dividend and gives the holder voting rights.
Buying stock directly from a corporation.
Using dividends previously earned on stock to buy more shares.
The part of the corporation's profits paid to stockholders.
earnings per share
A corporation's after-tax earnings divided by the number of common stock shares outstanding.
Stocks in corporations that reinvest their profits into the business so that it can grow.
Stocks that have a consistent history of paying high dividends.
The use of borrowed money to buy securities.
The price which a stock is bought and sold in the marketplace.
An assigned (and often arbitrary) dollar value that is printed on a stock certificate.
A stockholder's written authorization to transfer voting rights to someone else, usually a company manager.
Selling stock borrowed from a broker that must be replaced at a later time.
An increase in the number of outstanding shares of a company's stock.
Shareholders; owners of a corporation.
The amount a bondholder will be repaid when the bond matures or is due.
A bond that the issuer has the right to pay off before its maturity date.
A corporate bond that is not backed by collateral but only by the general credit standing of the corporation.
A corporate bond backed by specific assets as collateral to assure repayment of the debt.
A corporate bond that the bondholder can choose to exchange for a specified number of shares of the corporation's common stock.
A bond issued by state and local governments.
A municipal bond issued to raise money for a public works project.
general obligation bond
A municipal bond backed by the power of the issuing state or local government to levy taxes to pay back the debt.
A bond issued by a federal agency, such as the Federal Home Loan Mortgage Corporation.
A bond that is sold at a deep discount, makes no interest payments, and is redeemable for its face value at maturity.
Highly rated bond that is considered safe because the issuer is stable and dependable.
A bond that has a low rating, or no rating at all.
The use of savings to earn a financial return.
A rise in the general level of prices.
Rule of 72
Technique for estimating the number of years required to double your money at a given rate of return.
The chance that an investment's value will decrease.
The spreading of risk among many types of investments.
Trained professional planners who give overall investing advice based on your goals, age, lifestyle, and other factors.
A summary of a corporation's financial results for the year and prospects for the future.
Debt obligations of corporations or state or local governments.
A unit of ownership in a corporation.
A bond purchased at less than its maturity value.
A large, professionally managed group of investments.
A contract sold by an insurance company that provides an investor with a series of regular payments, usually after retirement.
Contracts to buy and sell commodities or stocks for a specified price on a specified date in the future.
The right, but not the obligation, to buy or sell a commodity or stock for a specified price within a specified time period.
Low-priced stocks of small companies that have no track record.
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