Stocks
What is the definition of stocks
a share in the ownership of a company, including a claim on the company's earnings and assets
What are bonds?
Are basically loans that the government or corporation must pay back with interest.
What does it mean to invest?
Expend money with the expectation of achieving a profit or material result by putting it into financial schemes.
What is a savings account?
A demand deposit account designed for the accumulation of money in a safe place for future use
What are mutual funds?
an investment of a pool of money from many investors
What is stock exchange?
A market where securities are bought and sold
What are the 3 components of bonds?
Coupon Rate, Maturity, Par Value
What does certification of deposit work?
pays a fixed interest rate on money held for an agreed-upon period of time
sum of money set aside on which interest is paid
What is turn over rate?
what is the term for how often the stock fund manager trades the shares of stock in a mutual fund
What is common stock?
A share of ownership in a corporation that gives the holder voting rights and a share of the profits
What are the types of bonds?
Savings, Municipal, Corporate, Junk
Certification of Deposit meaning?
pays a fixed interest rate on money held for an agreed-upon period of time.
What is simple interest?
interest computed on principal once during a certain time period
What are capital gains?
What are the main ways to make money in a mutual fund
What is preferred stocks?
A share of ownership in a corporation giving the holder a share of profits but, in general, no voting rights
What is coupon rate?
The interest rate the the bond issuer will pay to the bond holder.
What is Certification of Deposit?
a type of savings account offered by banks and credit unions
What is liquid?
meaning you can generally withdraw your money at any time without penalty
What is the safest type of mutual fund
money market
What is NASDAQ
America's largest electronic stock market. Many technology stocks such as Apple, Microsoft and Yahoo are traded on this stock exchange
What advantages do the issuer have?
- Once the bond is sold, coupon rate will not change
- Bond holders don't own a piece of the company, like a stock holder
What is Certification of Deposit?
A certification issued by a bank to a person deposition money for a specified length of time.
Higher Rate then Regular Savings
What is compound interest?
interest earned on both principal and previously earned interest
What is expense ratio?
an amount the investor pays to the mutual fund family ONCE a year for the right to invest in a mutual fund