General Investing Knowledge
This is the process of buying and holding a diversified portfolio of assets for a LONG period, often years or decades.
What is long-term investing?
This ratio shows how much money a company makes for each share of its stock
What is Earnings Per Share (EPS)?
This metric shows the market value of a company and is calculated by multiplying the share price by the total number of outstanding shares.
What is market capitalization (market cap)?
This financial statement provides a snapshot of a company’s assets, liabilities, and shareholders’ equity at a specific point in time.
What is the balance sheet?
This financial term describes the money you earn from an investment, which can come from dividends, interest, or capital gains.
What is return/profit?
The process of buying stocks/securities from diverse industries
What is diversification?
This ratio compares total liabilities to shareholders' equity.
What is Debt-to-equity ratio?
The price a stock begins the trading day at
What is the open price?
This financial statement shows a company’s revenues, expenses, and net income over a given period.
What is the income statement (or profit-and-loss statement)?
This is the legal term for when an individual or entity trades stocks based on confidential, non-public information.
What is insider trading?
Official term for when a company becomes publicly traded
What is an IPO?
Investors use this ratio to compare the price of a stock to the earnings generated per share over the last 12 months.
What is Price-to-earnings ratio (P/E)?
This ratio, usually expressed as a percentage, measures the dividend return per share divided by the market price of the stock.
What is dividend yield?
This statement tracks a company’s cash inflows and outflows, divided into operating, investing, and financing activities.
What is the cash flow statement?
A term used to describe when stock prices rise rapidly due to investor excitement, often leading to a sharp decline afterward.
What is a bubble?
The act of buying a stock at consistent intervals, with the goal of averaging out fluctuations in the stock's price
What is Dollar Cost Averaging (DCA)?
This ratio compares current assets to current liabilities.
What is the Current Ratio?
The number of shares of a stock that are traded during a given time period
What is volume?
A conference call between management of a public company, analysts, investors, and media to discuss a company's financial results during a given reporting period
What is Earnings Call?
What emotional phenomenon oftencauses people to buy stocks without proper research, especially when they see others hyping it up?
What is Fear of missing out (FOMO)?
This type of order allows an investor to sell a stock automatically when its price falls to a specified level.
This ratio compares a company's market price to its book value.
What is the Price-to-book ratio?
Metric that measures the volatility of a stock compared to the rest of the market.
What is beta?
The most comprehensive compilation of information on a company, a document required by the SEC for all public companies
What is Form 10-K?
This common financial index tracks the performance of 500 large U.S. companies.
What is the S&P 500?