Terms and definitions
what does our cca YIS stand for
youth investment society
How to start early and why
savings account
The earlier you start, the more time your money has to grow
Why do we save? (4)
To buy things we want, prepare for emergencies, and reach for bigger goals, financial security
Does trends matter, True or False
True! Investors look at trends and patterns, not just the current price. If a stock is dropping fast, it might keep dropping.
What does buying shares mean?
Buying shares means owning a small part of a company
name 3 rules
never stop learning, dont put all your eggs in one basket, think long term, know and do your homework, starting early
What is “having an emergency fund”?
This strategy means planning for emergencies so you don’t have to borrow money when something unexpected happens.
2 things that make a business valuable
future growth potential, profitability, assets, and resources, customer loyalty, and brand reputation.
What is a need and want?
Needs = essential, Wants = extra.
Which best describes the Rule to ‘Think Long Term’?
Making choices that will help your money grow and be safe in the future
What is interest?
The money a bank pays you for keeping your savings with them.
In simple terms, what is supply and demand
Demand refers to the willingness and ability of investors to buy a stock at various prices
Supply refers to the total number of shares a company has issued and are available for investors to buy, representing the quantity that shareholders are willing to sell at a given price
2 ways shareholders may earn money
Diversification means spreading your money across different types of investments (like stocks, bonds, real estate, etc) instead of putting it all in one place. “Don’t put all your eggs in one basket.”
What is compound interest?
This type of interest earns money not just on your original savings, but also on the interest already added.
Why do stock prices change?
Company performance, Future expectations, Economic conditions, Investor behavior
What is a stock ticker? Give one example
A stock ticker is a short abbreviation or symbol used to represent a publicly traded company on a stock exchange. It’s like a nickname for the company’s stock. Apple is AAPL
What does time horizon arbitrage mean?
making gains by thinking long-term, while others focus on the short-term.
If you deposit $1,000 in a savings account with 5% annual interest compounded annually, how much money will you have after 3 years?
$1,000 × (1 + 0.05)³ = $1,157.63
What is the formula and definition of P/E ratio
Price to earnings ratio = stock price/earnings per share
It is the ratio of a company's share price to the company's earnings per share.