NGPF-Investing Unit

Inflation

A continuous rise in the price of goods and services

portfolio

A list of your investments

index fund

A mutual fund that tries to match the performance of a particular index by investing in the companies included in that index.

Index Fund

A mutual fund that was designed to reduce fees by investing in the stocks and bonds that make up an index

Bull Market

A period of increased stock trading and rising stock prices, encouraging buying

stock symbol

A unique series of letters assigned to a Company's stock for trading purposes. They are also known as "ticker symbols"

Negatives to only putting money in savings account

Money doesn't grow large enough to keep up with inflation

capital gains

The positive difference between the purchase price of a stock and its sale price.

investing

The process of setting money aside to increase wealth over time for long-term financial goals such as retirement

stock exchange

a market for buying and selling stock

bear market

a market in which prices are falling, encouraging selling.

risk tolerance

how comfortable you are with the ups and downs of investing

tips for first time investors

keep investments diverse don't be too risky keep money invested for a long period of time

reasons to put money in a savings account

low risk emergency fund

savings

money put aside for future use; growing your money is not the top objective

dividends

payments of cash from a corporation to its stockholders

stocks

securities that represent part ownership or equity in a corporation

factors that impact stock prices

supply demand news and anticipated news about a company

mutual fund manager

the person in charge of a pool of shareholders' money invested in an assortment of different securities

asset allocation

the process of spreading your assets among several different types of investments to lessen risk

mutual funds

an investment program funded by shareholders that trades in diversified holdings and is professionally managed.

shareholder

an owner of shares in a company

two ways to profit from owning stocks

capital gains (selling stocks) dividends (money paid out to you from the company you own stock in)

Exchange Traded Funds

collections of stocks, bonds, and other investments that are traded on exchanges but are traded more like individual stocks than like mutual funds