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Make Your Money Grow-Basics of Investing for Youth

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Rate Of Return

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Terms in this set (12)

The ratio of money gained or lost on an investment relative to the amount of money invested

The portion of corporate profits paid out to stockholders

Diversification

The practice of investing in a large variety of stocks, bonds, and/or funds as a way to reduce your overall risk

Profit from the sale of an asset, such as a stock or a bond, calculated by subtracting the price you initially paid from the price you then sold it for

Degree of uncertainty on how likely the investor is to make money on an investment

Compound interest

Interest earned on both the principal amount and any interest already earned; It is the result of reinvesting interest.

Refer to the original amount of an investment or refers to the original sum of money borrowed in a loan, or put into an investment.

A formula that is popularly used to estimate the number of years required to double the invested money at a given annual rate of return.

A general and progressive increase in prices

When most stock prices are rising over several months.

A steady drop in the stock market over a period of time

A person that buys or sells an investment for you in exchange for a fee called commission.