Stock Market

Bull Market

a market where prices are rising.

Diversified

a portfolio strategy designed to reduce risk by investing in a variety of investments.

Cyclical Stock

a stock whose price is affected by the ups and downs of the economy

Is investing in stock risky

Investing in stock tends to be more risky than investing in bonds, real estate, gold and cash. It is quite easy to lose money owning the wrong stocks,however, purchasing the right stocks and then holding onto them over the long term can be very profitable.

Big Board

The oldest, largest,and most well known stock exchange in the US is located on Wall Street in New York City. It is often referred to as the

Stock Split

When a company finds that its high stock price is discouraging new investors, it may initiate a _____ _____ to lower the price and increase trading.

Bear Market

a market where prices are falling.

Stock Holder

an individual, group or company buys stock in a corporation they become a part owner or...

NASDAQ

stands for the National Association of Security Dealers Automated Quotations. to use computers and telecommunications to trade shares rather than a traditional trading floor.There is no physical location for the NASDAQ. All stock trades are done electronically through a network of dealers.

Origins of the New York Stock Exchange

can be traced back to 1792 when a group of men began trading stock under a buttonwood tree on Wall Street

What do investors look for

Investors look for companies with the best possibility for strong, long-lasting earnings. It's a good idea to research a company before you invest in it. Some Internet resources that can help you analyze the potential if a stock include MarketWatch, Yahoo, Bloomberg, NASDAQ, Financial Sense and US Securities and Exchange Commission

Dow Jones Industrial Average

Sometimes referred to as the ___, it is best-known and most widely followed market indicator in the world. It tracks the performance of 30 US blue chip stocks.

Why does the price of stock go up

Stock prices go up because more investors want to buy the sell. If a large number of investors buy a particular stock, the price of that stock will rise, making it a more valuable stock. On the other hand, stock prices go down because more investors want to sell than buy. In order to quickly sell their shares, stockholders may be willing to accept a lower price.

How do investors make profit

Stockholders profit through dividends when a company they invested in profits. And by selling stock for more than they paid for it. Investors also profit by a strategy called compounding. Simply put, compounding is earning interest off from interest. It is a strategy of reinvesting your dividends and leaving your money invested and letting its returns compound, allowing you dollars to earn interest off from its own interest.

Dollar Costing Average

This strategy enables investors to accumulate shares of stock by purchasing shares on a regular basis with a fixed dollar amount

TIPS for buying stock

When making a stock you make a bet that other people will want to buy that stock to and prices will go up too. Carefully research stock before buying it Invest in stock that offer products in demand Keep your money diversified A stock is only as valuable as people think it is, so it's a good idea to track your stocks regularly Stay informed about not only your stock but the economy in general

Stockbroker

a licensed professional who advises individuals about investments. He or she also helps investors buy and sell stocks, bonds, and mutual funds. The ______ earns a commission, usually a percentage of the transaction.

Penny Stock

a nickname for extremely low priced stock, usually only a few dollars a share These stocks are considered highly risky. They are priced low because they have not yet proven themselves in the market.

Stock Exchange

a place where stocks are bought and sold. There are many stock exchanges in the US and around the world. The 2 major US _____ ________ include:The New York Exchange and NASDAQ.

Stock

a share of stock; represents partial ownership in a corporation or a share of a corporation can

Standard and Poor's 500 Index

a stock market index that tracks the 500 most widely held stocks on the NYSE and is used as an indicator of stock market trends.

Income Stock

a stock that is purchase primarily for income which is paid out in the form of dividends

Defensive Stock

a stock that tends to remain stable under difficult economic conditions. _________ ______ include food, oil, utilities, etc.

Financial Industry Regulatory Authority

also looks out for investors. It is the place consumers take complaints. The _____ has the ability to fine individuals and organization for unethical behavior and can revoke licenses.

Market Indices

are a snapshot of how the ______ is doing in general. There are many _______. Two of the most widely used indices are DJIA and S&P 500

Growth Stock

generally young companies with growth potential. These companies usually re-invest most of their profits back into the business to expand and strengthen it. As a result they do not pay dividends

Blue Chip Stock

is a very solid and reliable companies with long history of consistent growth and stability Ex. Coke, Disney, Nestle. The term comes from blue chips used in poker, always the most valuable chip.

Investors

most often have portfolios, a collection of diversified investments including stocks, bonds and mutual funds.

Initial Effect of a Stock Split

no different than trading a dime for two nickels.

Long Term Effect of a Stock Split

now there are twice as many shares available to buy in the market at half of the price.

Securities and Exchange Commission

regulates the activities of stock traders. Its job is to safeguard investors against fraud practices and to make sure that the securities markets operate honestly and fairly. It has a strong anti-fraud unit that monitors advertising and marketing to make sure companies comply with strict rules concerning the sale of securities.

Initial Public Offering

the first time a company's stock is sold, the company is going public. In other words, the owners of the company are selling part ownership to the general public. The official term for is ___

Common Stock

the most frequently issued class of stock, it represents basic ownership of a corporation and provides voting rights, companies issue ______ stock before preferred stock, ______ shares on average out-perform preferred shares over time.

NASDAQ companies

to use computers and telecommunications to trade shares rather than a traditional trading floor.There is no physical location for the NASDAQ. All stock trades are done electronically through a network of dealers.

Why Companies Issue Stock

when they need to raise cash. In exchange for cash, the company gives up some control of the company to its shareholders.