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47 terms

Dobbs stock vocab

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Common stock
is more risky, has a fluctuating dividend, and has voting rights.
Bear Market
A condition of the stock market in which prices of stocks are generally on a decline
Board of Directors
Chosen by the stockholders, they make the policies and goals of the company.
Diversification
Spreading out your investment
Liquidity
Converting assets into cash
Bond
A loan made to a business, it does not signify ownership.
Coupon
The component of a bond that states the interest rate.
Dow Jones
The top thirty stocks whose gain or loss for the day are totaled for each trading day.
Liability
All financial debt that is your responsibility.
Big Board
Nickname for the New York Stock Exchange
Bull Market
Period of increasing stock prices
Capital gain
Selling your investment for more than you bought it for
Dividend
A share of the company's profit paid to the holders of the stock
Stock certificate
Proves you own the stock
Stock broker
A licensed professional who handles stock purchases and sales
Tickertape
An instant record of stock sales for the stock exchange.
Speculating/Speculator
Buying and selling stocks as a way to earn a fast profit. They make high risk investments with borrowed money. They buy on margin
Prospectus
Gives the history and background of the company-including management and the company's ability to pay back their debts.
Takeover
One investor group buys enough stock in a corporation to gain control of the other corporation
Trading specialist
Brings the buyer and the seller together. Each booth has one. They keep track of the current bid/asking price.
Yield
Dividing the annual dividend by the current price of the stock
Secondary Market
When the public buys and later sells shares of stock
Preferred Stock
Has no voting rights, a fixed dividend, is less risky, is more expensive and gets paid first.
Par Value
The amount of money you originally loaned to the company
Maturity Date
When the bond is redeemable.
IPO
The first time to stock is offered to the public (initial public offereing)
Blue Chip stocks
Best performing stocks, fortune 500 companies, typically very conservative, traded on the NYSE
Bid
The highest price a buyer is willing to pay for a stock
Stock Split
Division of a single share of stock into more than one share, the price is also split in half. It is used when companies want to encourage investors.
Brokerage Houses
Employ market analysts to research firms to find strengths and weaknesses of businesses looking for financial investors.
Trading Booth
Horseshoed shaped counters-responsible for trading about 100 companies.
Floor Brokers
They actually make the buy/sell for you and me.
NASDAQ
2nd largest exchange. Most securities traded are industrial and technology. Do their trading over phone and on computer only.
Portfolio
A collection of all of your investments (securities)-shows total assets.
Change
The difference between a stock's closing price that day and its closing price the day before.
P/E ratio
The closing price divided by the company's earnings per share.
Securities
Stocks and bonds
S&P500
Index that showa the performance of a limited number of stocks.
Mutual fund
Pooling your money with other investors and allowing a company with trained specialists to invest your money. It's a good way to diversify your investment
Asset
Items of ownership that can be converted into cash.
Securities and Exchange market
Regulatory Agency that oversees the financial markets including the stock markets.
Moodys
Rate bonds. This allows investors to determine which bonds are a lower risk.
Treasury Bond
Long term investment (maturity-10-20 yrs)
Treasury Note
Intermediate term investment (maturity-2-10 yrs)
Treasury Bill
Short term (maturity 3,6, 12 months). Seen as a shelter when the stock market is doing poorly.
Publicly held corporations
Sell their stock to a financial institution for starting capital and then that financial institution sells it to the public.
Quarter
Every three months.