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Corporations and Stock
Common and Preferred
Types of Stock
The Market
Buying, Selling, and Trading
100
What the offering is called when a company first offers stock. This offering is issued in the primary market prior to being offered to the general public in the secondary market by brokers.
What is an IPO?
100
A process in which the shares of stock owned by existing shareholders are divided into a larger number of shares, but typically at half the price if 2:1.
What is a stock split?
100
Considered a safe investment, this type of stock attracts the conservative investor who are interested in companies that represent industry leadership, a history of stable earnings, and consistency in the payment of dividends. They are large and legendary companies.
What is a blue chip stock?
100
Two terms given to the market when investors are optimistic and pessimistic, respectively, about the economy.
What is are bull market and bear markets?
100
Investments, such as stocks, bonds, mutual funds, options, and commodities are given this generic term.
What are Securities?
200
A closely held corporation, one who's shares are owned by a relatively small group of people and not traded openly on any of the market exchanges.
What is a private corporation.
200
The dollar value printed on a stock certificate. For Preferred stock - your dividend may be a specific $ amount assigned by the board, or a percentage of this value.
What is a par value of stock?
200
This type of stock's value typically follows the up's and down's of the economy and is also impacted in high inflationary periods.. You may want to add Defensive stock to your portfolio to offset this type of stock's behavior.
What is Cyclical Stock.
200
Annual dividend / a stock's current market value gives you this stock evaluation metric.
What is Current Yield?
200
This type of market is where banks and other investment institutions purchase securities from corporations for the first time. Initial Public Offerings (IPO), the "first time" offering of stock, are largely sold here here and purchased by financial institutions for resale in the secondary exchanges.
What is a Primary Market.
300
This type of corporation sells shares of stock openly on the stock market where anyone can buy them.
What is a public corporation?
300
A form of or feature of preferred stock that can be exchanged for a specified number of shares of common stock.
What is Convertible Stock?
300
This type of stock is cheap, $5 or less according to the US Treasury, but in many cases they are risky given there is little data to investigate the companies that issue them.
What is Penny Stock?
300
Current Return + Capital Gain equals this stock measurement.
What is Total Return.
300
Selling or buying stock in batches of fewer than 100 shares.
What is an odd lot.
400
A document that transfers a stock holder's voting rights to someone else.
What is a proxy?
400
For the Preferred Stock holder, this is a feature of stock whose unpaid dividends build up and must be paid before any cash dividend is paid to the common stock holder.
What is Cumulative Preferred Stock?
400
The total dollar value of stocks and bonds issued by a corporation and owned by shareholders, world-wide.
What is Market Capitalization?
400
A widely used measurement of a corporation's performance is this and measures the amount of corporate profits that can be assigned to each share of common stock. It is calculated as: Net Earnings / Common Stock Outstanding
What is Earnings Per Share.
400
This is the market exchange for buying and selling existing securities that are currently traded among investors...you and I. Such securities are sold time and again on security exchanges (NYSE and AMEX) or Over-The-Counter (OTC) like the NASDAQ.
What is a Secondary Market.
500
The right to buy any new stock a corporation issues before the stock is offered to the general public. In the military, this may be similar the a "preemptive strike".
What is a preemptive right.
500
This is a rare feature which allows preferred stock holders to share in the remaining earnings of a corporation's earnings with common stock holders after dividends are paid.
What is a Participation Feature.
500
Stocks listed in the Dow Jones Average are typically this type of stock. Their market capitalization is greater than $500M.
What is a large cap stock.
500
This measurement is often used by investors when deciding to invest in a certain stock. If the value for this measurement is low, it could mean that the stock is a good investment as the company's earnings may be high compared to the price of its stock. It is calculated by: Market Price Per Share / Earnings Per Share
What is Price /Earnings Ratio
500
Selling or buying stock in batches consisting of 100 or multiples of 100 shares is given this term.
What is a round lot.