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Economy

Terms in this set (59)

IPO
Initial public offering, a corporation's first offer to sell shares to the public
Stock
A share of ownership in a corporation.
shares
equal portions of a corporation's stock
shareholder
A person who invests in a corporation by buying stock and is a partial owner
equities
Financial rights to the assets of a business
bonds
Certificates of debt that carry a promise to buy back the bonds at a higher price
securities
stocks and bonds
ticker symbol
The abbreviated term that is used to identify a stock for trading purposes
quote/last
The price of the last trade
Bid/ask
prices at which a securities dealer offers to buy and sell stock
market order
a request to buy or sell a stock at the current market value
limit order
a request to buy or sell a stock at a specified price
broker
a wholesaler who does not take title to goods and whose function is to bring buyers and sellers together and assist in negotiation
commision
amount paid to an employee based on a percentage of the employee's sales
trade
stock is bought/sold
sectors
genre of business
dow jones industrial average
Measure of average of stock prices of major industries (30)
NASDAQ 100
this index includes 100 largest domestic & international non-financial companies listed on NASDAQ
S&P 500
index that shows the price changes of 500 different stocks
index/indeces
grouping of stocks used to track progress. used to measure health of economy.
opening and closing bell
9:00 to 4:30
SEC
Securities and Exchange Commission - regulates stock market
revenue
total income
profit
total income minus expenses
Quarterly
companies report every 3 months
dividend
The portion of corporate profits paid out to stockholders
yield
the annual rate of return on a bond if the bond were held to maturity
volume
total number of stocks traded
EPS
earnings per share
P/E multiple
how cheap a stock is relative to earnings. The use
of the ________ is especially helpful
in valuing firms
that are not publicly traded.
TTM
trailing twelve months
market cap
an estimation of the value of a business that is obtained by multiplying the number of shares outstanding by the current price of a share
long term investments
investments in stocks and bonds of other corporations that companies hold for more than one year
short term investments
Investments in stocks that companies hold for less than one year
Bull Market
A period of increased stock trading and rising stock prices
bear market
A steady drop in the stock market over a period of time
rally
short term rise in stock
crash
short term fall in stock
volatility
Indicates how much and how quickly the value of an investment, market, or market sector changes.
portfolio
A list of your investments
Diversification
Spreading out investments to reduce risk
percentage gain
The percentage gain in an investment (calculation: take the amount gained and divide it by the initial investment)
percentage loss
loss / cost price x 100%
Splits/reverse splits
increase number of shares/decrease share value
spin off
strategy of setting up one or more corporate units as new, independent corporations
mutual funds
A pool of money used by a company to purchase a variety of stocks, bonds or money market instruments. Provides diversification and professional management for investors.
hedge fund
A private investment organization that employs risky strategies that often made huge profits for investors
ETF
exchange traded fund (unmanaged mutual fund)
margin buying
paying part of the cost and borrowing the rest from brokers
short selling
bet to see if a company is going bankrupt
buy back
company reduces amount of shares in circulation by buying them
Realized Gain
sale price is greater than the investment carrying amount
Realized Loss
sale price is less than the investment carrying amount
Unrealized Gain
The amount by which a security appreciates in value before it is sold. Until it is sold, the investor does not actually possess the sale proceeds.
unrealized loss
hypothetical loss in stock
Average down
lowering price by buying
earnings
The amount of money that remains after subtracting the company's expenses from its revenue.
tax write-off
when you count stock losses against gross income
cost basis
the average price of each share you own
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