What is Stock?

Portfolio

A collection of investments owned by one individual or organization.

Private Company

A company owned by a person, family, or small group of investors that does not sell stock to the public.

Public Company

A company owned by investors who buy shares of stock usually through a stock exchange.

Parent Company

A company that owns enough voting stock in another firm to control management and operations.

Stock

A security that signifies ownership in a corporation and represents a claim on a part of the corporation's profit (or loss). Companies usually issue stock to raise money for a variety of reasons, including expanding or modernizing their operations.

Stockholder

Also known as a shareholder is the owner of the stock.

Initial Public Offering (IPO)

An IPO is the first issue of stock for public trading made by a company.

Risk Tolerance

An individual investor's ability to accept loss of some or all of the money they have invested. A person's risk tolerance is based on a number of factors including age, financial stability, amount of time before the invested funds are needed for other purposes, etc.

Preferred Stock

Often pay a fixed dividend on a regular schedule. The prices tend to be less volatile than common stock. Preferred stocks tend to move with changing interest rates. Preferred stocks holders cannot vote on corporate matters.

Dividend

Part of a company's profits (earnings) that is paid as money or shares to stockholders. In The Stock Market Game, any dividends received are listed in Transaction History and are included in the portfolio's total equity.

Stock Exchange

Place/electronic platform where shares of are bought and sold.

Common Stock

Shares represent ownership in a corporation and give the right to vote for the company's board of directors and benefit from its financial success

Investor

Someone who purchases stocks, bonds, mutual funds and other financial instruments in hopes the investments will increase in value over time.

Risk

The chance of losing all or part of the value of an investment.

Earnings

Whatever profits or net income remains after subtracting the company's expenses from its revenue.