Vocabulary 1 (Ch. 8.1 - 8.5)
Definition: Individuals who own shares of stocks in a company
Shareholders
Definition: A collection of all the stocks that an investor has in their possession
Portfolio
A corporation issues 20.5 million shares of stock to shareholders. How many shares must a shareholder own to have a majority ownership of the company (total # of shares)?
10,250,001 Shares
Majority ownership = 50% of all shares (+) 1 additional share
20,500,000 x 50% = 10,250,000 Shares
10,250,000 + 1 more share = 10,250,001 Shares
Mr. Muntain bought 100 shares of Tesla at $208.80 per share. Mrs. McCree bought 125 shares of Johnson & Johnson at $159.56 per share. What's the difference in the total amount of money that both teachers spent to purchase their shares?
$935
Mr. Muntain total cost: 100 shares (x) $208.80 per share = $20,880
Mrs. McCree total cost: 125 shares (x) $159.56 per share = $19,945
Difference between two teachers total cost: $20,880 (-) $19,945 = $935
A group of Kangaroos is called:
A) A Hop
B) A Jump
C) A Troop
D) Kangaroos...?
C) A Troop
Definition: The number of shares traded within a given amount of time
Volume
Definition: When you buy or sell a stock at the best available price right this very second
Market Order
You, your brother, your mom, and your dad each own a portion of the family business (BIG Bites Bay-Bay!), which manufactures and sells a variety of fishing products. All of you invest in the company at a ratio of 4:2:6:9.
What % of the BIG Bites Bay-Bay! is owned by your dad? Round to the nearest hundredth of a percent.
42.86%
Step 1: Add all numbers in the ratio to get a total amount of shares. (4 + 2 + 6 + 9 = 21 total shares)
Step 2: Divide the individual person's portion of ownership by the total amount of shares (Dad = 9 pieces of ownership ÷ 21 total shares = 42.86%)
Justin Jefferson bought 20,000 shares of NIKE stock at $101.15 per share. He paid his broker a flat $25 commission for the buy order. One year later, Justin sold all 20,000 shares at $133.65 and paid his broker 1.5% commission for the sale order. What was Justin's capital gains on his investment, ignoring the fees and commissions?
Capital Gains = $650,000
Step 1: Take the difference between the buying and selling price. ($133.65 - $101.15 = $32.50 profit for each share)
Step 2: Multiply the # of shares (x) the profit for each share. (20,000 shares (⋅) $32.50 profit for each share = $650,000)
In the video game Minecraft, how many real-world minutes make up a full day in the game?
A) 10 minutes
B) 15 minutes
C) 20 minutes
D) 25 minutes
C) 20 minutes
Definition: The final price a stock was traded at during the end of a regular trading day
Close
Definition: The total number of shares issued by a company and available to trade
Outstanding Shares
On Feb. 1st, 2024, $META stock price closed at $394.78. The very next day, $META stock price closed at $474.99. What was the % increase in Meta's closing price? Round to the nearest hundredth of a percent.
Use the following formula to help you solve: % Increase = (New $ - Original $) ÷ Original $
20.32%
% Increase = (New $ - Original $) ÷ Original $
Meta % Increase = ($474.99 - 394.78) ÷ 394.78 = 20.32%
Caterpillar (Symbol: CAT) offers their shareholders quarterly dividends in the amount of $1.30 per share owned. If you owned 290 shares of CAT, how much would you receive in dividends after 6 months?
Dividend Income = $754
To calculate Dividend Income, multiply Dividend Amount (x) Number of Shares Owned (x) Number of Quarters the dividends get paid out.
($1.30 Dividend x 290 shares x 2 Quarter payouts = $754)
Taylor Swift is the most popular artist globally. But which music artist comes in 2nd and also holds the Guiness World Record for Most Monthly Listeners on Spotify, at 111.4 million?
A) Drake
B) The Weeknd
C) Travis Scott
D) Metro Boomin
Definition: An indicator that's calculated by determining the mean closing price over several days
Simple Moving Averages (SMA)
Definition: When a company reduces the number of outstanding shares by combining a portion of shares into one larger share
Reverse Stock Split
Caterpillar (Symbol: CAT) offers their shareholders quarterly dividends in the amount of $1.30 per share owned. The current share price of CAT is $321, giving it a current dividend yield of 1.62%. If CAT's stock price were to increase to $399 and the quarterly dividend remained at $1.30 per share, what would be the new dividend yield be as a percentage? Round your answer to the nearest hundredth.
Use the following formula to help you find Dividend Yield: % Yield = ANNUAL Dividend ÷ Stock Price
New Dividend Yield = 1.30%
Formula for Dividend Yield: ANNUAL Dividend ÷ Share Price
Step 1: Calculate ANNUAL Dividend. [$1.30 every quarter (x) 4 quarters = $5.20 annually]
Step 2: Use the formula. ($5.20 ÷ $399 stock price = 0.013032.....)
Step 3: Change decimal to a percent. (0.013032 becomes 1.3032%)
Door Dash currently has 388.98 million outstanding shares and is currently trading at $183 per share.
Question: If in a few years, Door Dash decides to undergo a 3-for-2 traditional stock split, how many outstanding shares will they have in a few years? And what will the new share price be?
Outstanding Shares in a few years = 556,110,000. New Price per Share = $72
Traditional Stock Split = Increasing the number of shares available & Decreasing the price
3-for-2 Traditional Split = You'll receive 3 new shares for every 2 existing shares you currently own.
Formula: Outstanding shares (x) (new shares (÷) existing shares owned)
[ 388,980,000 x (3 ÷ 2) ] = 583,470,000 Outstanding Shares)
New Price per share = Current price (x) The Number of Shares it takes to create one New Share. [ $183 x (2 existing shares ÷ 3 new shares) = $72 ]
Channel your inner Star Wars nerd for just a moment. If you were in a ship that could travel at the Speed of Light (~186,000 miles per second) and you wanted to go from Earth and Mars when they were at their closest possible distance to each other, how long would it take you to get there?
A) About 30 seconds
B) About 3 minutes
C) About 13 minutes
D) About 30 minutes
B) About 3 minutes
*The closest distance between Earth and Mars is about 38.6 million miles
Definition: A type of market analysis that uses supply and demand to assess future price movement.
Money Flow
Definition: An investment in the debt of a business that you can purchase, which helps the company raise capital
Corporate Bond, or Bonds
Ideanomics Inc. (Symbol: IDEX) currently has 12.1 million outstanding shares and is currently trading at $0.97 per share.
Question: If next week, IDEX decides to undergo a 1-for-8 reverse stock split, how many outstanding shares will they have? And what will the new share price be?
Outstanding Shares = 1,512,500. New Price per Share = $7.76
Reverse Stock Split = Decreasing the number of shares available.
1-for-8 Reverse Split = You'll receive 1 new share for every 8 existing shares you currently own.
Formula: Outstanding shares (x) (new shares (÷) existing shares owned)
[ 12,100,000 x (1 ÷ 8) = 1,512,500 Outstanding Shares ]
New Price per share = Current price (x) The Number of Shares it takes to create one New Share. [ $0.97 x (8 existing shares ÷ 1 new share) = $7.76 ]
Chris Hemsworth bought 15,000 shares of Estée Lauder stock at $161.42 per share. He paid his broker a flat $49 fee for the buy order. One year later, he sold all 15,000 shares at $260.12 and paid his broker 1.6% commission for the sale order. What was Chris' net proceeds from his investment?
(*Remember, Net Proceeds are what you make AFTER you pay your fees and commissions)
Net Proceeds = $1,418,022.20
Formula for Net Proceeds = Capital Gains (-) [Fees + Commission]
Step 1: Calculate Capital Gains. [15,000 shares x ($260.12 - $161.42) = $1,480,500]
Step 2: Calculate Fees + Commission. [Fee = $49. Commission = 15,000 x $260.12 x 0.016 = $62,428.80. Fees + Commission = $62,477.80]
Step 3: Subtract Capital Gains and Fees, Commission. [$1,480,500 - $62,477.80 = $1,418,022.20
List the following monuments in order from oldest to youngest from when they were finished being built (NOT when they started building them):
Statue of Liberty, Lincoln Memorial, Eiffel Tower, Mount Rushmore, and Egyptian Pyramids
Oldest to Youngest:
Egyptian Pyramids (~ 2500 BC)
Statue of Liberty (1876)
Eiffel Tower (1889)
Lincoln Memorial (1922)
Mount Rushmore (1941)