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26 Cards in this Set

  • Front
  • Back
A collection of ownership shares in a company
A collection of investments
Stock Holder
A person who owns stock in a company
Capital Gain
The profit realized on the purchase or sale of a property, like real estate or stocks
A promise made by a corporation or government to pay an investor a certain amount of money, plus interest, at a specified time in the future
Maturity Date
The date on which a corporation or government will pay back the value of a bond plus interest
Stock Broker
A dealer in stocks and bonds
Fee paid to a broker for the service of buying, selling, and recommending stocks
Stock Exchange
The central market where brokers buy and sell securities
Why may savings accounts be a bad investment?
The rate of return (interest) may be less than the rate of inflation
What are the three important questions you should ask before buying stocks?
If I buy stock, will I:
1. be able to provide for my family?
2. have enough left over for emergencies?
3. have enough insurance to protect my family?
Blue Chip Stocks
Stocks of the largest corporations with long, steady records of paying dividends
Growth Stocks
Stocks issued by companies that are growing fast, but do not have a long record
Speculative Stocks
Stocks that are selling at a high price compared to history or earnings, but which may continue to grow
Municipal Bonds
Bonds issued by state or local governments, usually not taxable
Corporate Bonds
Bonds issued by companies
Federal Bonds
Bonds issued by the federal government with a fixed period of time before they can be redeemed
What is the difference between Federal Bonds and Savings Bonds issued by the federal government?
Savings Bonds can be cashed in at any time, but Federal Bonds cannot be redeemed until they reach their maturity date
What are the three kinds of Federal Securities and what is their maturity period?
Treasury Bills, less than year;
Treasury Notes, one to ten years;
Treasury Bonds, over ten years
Mutual Fund
Investment company that pools money from several investors to buy securities. You buy shares in the fund.
What is the difference in risk between investments that provide either high or low earnings rates?
High earnings rate investments usually have high risk
How do stock brokers make money?
Buy charging a commission on their service in buying or selling a stock
What are the two types of stack markets?
Organized exchanges, and "over-the-counter"
Common Stock
Stock that does not pay a fixed dividend but allows the owner to vote on activities of the company
Preferred Stock
Stock that entitles the owner to preferential treatment in the payment of dividends and the return of investment but does not have voting privileges
Money paid to an investor based on profits made by the company