Investment Basics
This principle explains how your investment grows because your returns earn additional returns over time.
What is compound growth
This term describes a market outlook where prices are expected to rise.
What is bullish?
This is the total amount of money a company earns from its sales before expenses.
What is revenue
This emotional bias causes investors to buy simply because everyone else is buying.
What is FOMO?
Borrowing funds to increase the size of an investment position is known as...
What is margin investing?
This is the smallest unit of ownership in a publicly traded company.
What is a share
This type of order executes immediately at the current best available price.
What is a market order?
This legally required metric shows how much profit a company made after all expenses.
What is net income?
This strategy invests a fixed amount on a consistent schedule, regardless of market conditions.
What is dollar-cost averaging?
A market showing higher highs and higher lows is in this type of trend.
What is a bullish/upward trend
These are the four distinct trading periods: pre-market, regular trading, after-hours, and overnight.
What are the four market sessions?
If a candlestick’s closing price is higher than its opening price, it is represented by this color.
What is green?
This valuation ratio is calculated by dividing a stock’s price by its earnings per share.
What is the P/E ratio?
This risk-reducing practice spreads investments across different sectors or asset classes.
What is diversification?
This statement tracks cash entering and leaving a business from operations, investing, and financing activities.
What is the cash flow statement?
This short alphabetic code, such as AAPL or TSLA, uniquely identifies a company on an exchange.
What is a ticker symbol.
A rapid price increase with a lot of support is...
What is a rally
This financial statement reports a company’s assets, liabilities, and shareholder equity at a specific point in time.
What is the balance sheet?
This retirement account allows your investments to grow tax-free after age 59½.
What is a Roth IRA?
This financial ratio compares the total debt of a company to its total shareholder equity.
What is the debt-to-equity ratio?
These two prices make up a stock’s spread: the highest price buyers are willing to pay and the lowest price sellers will accept.
What are the bid price and the ask price?
This is a distribution of a portion of a company's earnings, paid to a class of its shareholders.
What are dividends?
This figure represents how much profit a company earns for each share outstanding.
What is earnings per share (EPS)?
This behavioral bias causes investors to avoid selling losing positions because they dislike realizing a loss.
What is loss aversion?
Rising levels of this economic factor typically hurt stock valuations because borrowing becomes more expensive.
What are interest rates?