Investing Basics & Bonds
An employer-sponsored retirement account, and participating in one is one of the easiest ways to begin an investment program.
What is a 401(k) account?
A licensed individual who works for a brokerage firm and buys or sells investments for his or her clients
What is a stockbroker?
In the United States, 59 million households own these.
What is mutual funds?
A definite plan for the administration and disposition of one’s property during one’s lifetime and at one’s death.
What is estate plan?
A risk what reduces your purchasing power
What is inflation risk?
A marketplace where member brokers who represent investors meet to buy and sell securities
What is a securities exchange?
A fund that is a mirror image of a specific index
What is an index fund?
The legal procedure of proving a valid or invalid will and the process by which your estate is managed or distributed after your death, according to the provisions of your will.
This investment has returned an average of almost 10% per year over the past 100 years.
What is stocks?
______ = (assets - liabilities)/#of shares outstanding
What is book value?
the amount that investors pay for all of a mutual fund’s management fees and operating costs
What is expense ratio?
An employee’s right to at least a portion of the benefits accrued under an employer pension plan, even if the employee leaves the company before retiring.
What is vesting?
A term for your ability to buy or sell an investment quickly without substantially affecting its value.
What is liquidity?
The opportunity, but not the obligation, to buy a security within a specified period of time at a guaranteed price
What is a call option?
The profit that results from an increase in value when the investors sell their shares in a fund
What is capital gain?
Type of retirement account: contributions are not tax-deductible, but the earnings accumulate tax-free.
What is a Roth IRA?
_____ = tax-exempt yield/(1-your tax rate)
What is taxable equivalent yield?
The amount of Paolo's profit if he bought 200 shares of PDQ stock on margin at $15 per share. The stock increased to $21 per share.
What is $1,200?
The amount paid in commissions when $15,000 is invested in the Anderson Balanced mutual fund charging a sales load of 4.85 percent.
What is $727.50?
The type of will written when Carlos drafts a legal document leaving everything to his spouse.
What is a simple will?