57 terms

ECON-stock market

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mutual fund
a corporation which issues stock and uses the proceeds to invest in a variety of stocks or bonds to meet an investor's objective
investment objective
will direct the money management team as to what type of stocks and bonds to invest your money
IRA
individual retirement account
equity/stock funds
funds that invest in stocks
value funds
funds that invest in companies that undervalued
growth funds
funds which invest in companies which are growing in size
bond fund
invest only in bonds
income funds
funds that invest in securities that provide income. (EX. T-Bonds, T-Notes, T-Bills) Preferred stocks blue chip dividend paying stocks.
balanced/combination funds
funds that invest in stocks and bonds
Global and International funds
funds that invest in companies outside of the U.S. and around the world
Specialty/Sector Funds
funds that invest in one type of company or in one region
balance sheet
a financial statement summarizing a firm's assets, liabilities, and net worth at a point in time
assets
anything of value you own
liabilities
a debt or what a business owes
net worth
the difference between the assets and liabilities
income statement
(profit or loss statement) a summary of firms revenue and expenses over a period of time
coupon rate
the interest rate that a bond issuer will pay to a bondholder
maturity
the time at which payment to a bondholder is due
par value
the amount that an investor pays to purchase a bond that will be repaid to the investor at maturity
yield
the amount rate of return on a bond if the bond were held to maturity
savings bond
low denomination bond issued by the United States government
municipal bond
bond issued by a state or local government or municipality to finance such improvements as highways, state buildings, libraries, parks, and schools
corporate bond
bond that a corporation issues to raise money to expand its business
securities and exchange commission
an independent agency of the government that regulates financial markets and investment companies
junk bond
a lower rated, potentially higher paying bond
capital market
market in which money is lent for periods longer than a year
money market
market in which money is lent for periods of less than a year
primary market
market for selling financial assets that can only be redeemed by the original holder
secondary market
market for reselling financial assets
share
portion of stock
equities
claims of ownership in a corporation
capital gain
the difference between a higher selling price and a lower purchase price, resulting in a financial loss to the seller
stock split
the division of a single share of stock into more than one share
stockbroker
a person who links buyers and sellers of stock
brokerage firm
a business that specializes in trading stocks
stock exchange
a market for buying and selling stock
OTC Market
an electronic marketplace for stocks and bonds
Nasdaq
American market for OTC securities
futures
contracts to buy or sell at a specific date in the future at a price specified today
options
contracts that give investors the choice to buy or sell stock and other financial assets
call option
the option to buy shares of stock at a specified time in the future
put option
the option to sell shares of stock at a specified time in the future
bull market
a steady rise in the stock market over a period of time
bear market
a steady drop in the stock market over a period of time
the DOW
index that shows how certain stocks have traded
S & P 500
index that shows the price changes of 500 different stocks
the great crash
the collapse of the stock market in 1929
speculation
the practice of making high-risk investments with borrowed money in hopes of getting a big return
common stock
a type of stock issued by a corporation in which stockholders have voting rights
dividend
a share of corporate profits paid to stockholders
preferred stock
a type of stock which is issued by a corporation in which the stockholders receive dividends before common stock, usually have no voting rights, and are paid before common stock in the event of a liquidation
prospectus
a statement containing financial information published when a corporation is about to issue new securities
IPO
initial public offering
New York Stock Exchange (NYSE)
largest of the stock exchanges, more mature companies, usually higher priced stocks, often pay dividends
American Stock Exchange (AMEX)
a second exchange where listed stocks may trade
over-the-counter (OTC)
young and smaller companies trade, IPOs usually start here, lower priced stocks trade OTC, usually do not pay a dividend
Dow Jones Industrial Average (DJIA)
a calculation comprised of 30 of the leading industrial stocks in the U.S. dividend by a divisor
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