Investing
This investment strategy involves buying stocks that are undervalued relative to their intrinsic value, focusing on assets with strong fundamentals.
Value Investing
This financial instrument derives its value from the performance of an underlying asset, index, or rate, and is often used for hedging or speculative purposes
Derivative
This event, occurring in the early 2000s, resulted from the burst of a speculative bubble in the technology sector, leading to significant market downturns.
The Dot-com Bubble
This ratio measures a company's ability to generate profit from its operating activities before deducting interest and taxes.
Operating Profit Ratio
Stock Ticker: HD
Home Depot
This investment approach prioritizes stocks of companies expected to grow at an above-average rate compared to the overall market.
Growth Investing
This theory suggests that stock prices reflect all information available in the market.
Efficient Market Hypothesis
This year marked the beginning of the Great Depression, the most severe economic downturn in modern history.
1929
If a company's earnings per share (EPS) is $2 and its price-to-earnings (P/E) ratio is 15, what is its stock price?
$30 (Stock Price = EPS * P/E Ratio)
Stock Ticker: MRNA
Moderna
This widely followed index, comprising 30 large-cap U.S. stocks, is often considered a benchmark for the performance of the U.S. stock market.
Dow Jones Industrial Average (DJIA)
This type of derivative contract gives the holder the right, but not the obligation, to sell an asset at a predetermined price on or before a specified date
Put Option
This economist is known for his theory on supply-side economics and is often associated with Reaganomics.
Milton Friedman
This ratio measures a company's ability to pay its short-term obligations with its current assets.
Current Ratio
Stock Ticker: BA
Boeing Company
This popular growth investing metric measures the price of a stock relative to its earnings per share (EPS), indicating how much investors are willing to pay for each unit of earnings.
Price-to-earnings (P/E) ratio
This type of derivative contract obligates the holder to buy or sell the underlying asset at a predetermined price on a specified future date
Future or Futures Contract
This economic policy, implemented during the 19th century in several European countries, advocated for free trade, limited government intervention, and the gold standard.
Laissez-Faire Economics (Classical Liberalism)
If a company's total debt is $800,000 and its total assets are $2,000,000, what is its debt-to-assets ratio expressed as a percentage?
40% (Debt-to-assets ratio = (Total Debt / Total Assets) * 100)
Stock Ticker: ACN
Accenture
This method of stock analysis involves studying past market data, primarily price and volume, to forecast future price movements.
Technical Analysis
In the context of derivatives, this term refers to the price at which the underlying asset can be bought or sold, depending on the type of derivative contract.
Strike Price
This policy, implemented by the Federal Reserve, aimed to stimulate the economy by lowering interest rates and increasing the money supply during the early 2000s.
What is quantitative easing (QE)?
This ratio measures a company's ability to meet its short-term debt obligations using its most liquid assets.
Quick ratio (acid-test ratio)
Stock Ticker: C
Citigroup