Market Trends
This is the name for the place where people buy and sell shares of companies.
What is the stock market?
A person who puts money into stocks, bonds, or other things hoping to make more money later.
What is an investor?
A small piece of ownership in a company that you can buy and sell.
What is a stock? (or share)
Interest that is calculated only on the original amount of money (principal) and doesn't add to itself over time.
What is simple interest?
A loan you give to a company or government; they pay you interest and give your money back later (usually safer than stocks).
What is a bond?
When stock prices are generally going up and investors feel optimistic, it's called this "animal" market.
What is a bull market?
This is the chance that you could lose some or all of your money when investing.
What is risk?
This type of fund tries to copy the performance of a big market index (like the S&P 500) instead of trying to beat it; it's popular because it's low-cost and diversified.
What is an index fund?
This powerful way of earning money means you earn interest not just on your original money (principal), but also on the interest you've already earned!
What is compound interest
What is the difference between simple interest & compound interest?
Simple interest is earning interest on the original amount (principal)
Compound interest is earning interest on the principal & the interest together
When stock prices are falling a lot and people feel pessimistic, it's called this "animal" market.
What is a bear market?
Spreading your money across different types of investments (like stocks, bonds & funds) so one bad choice doesn't hurt you too much.
What is diversification?
When a company first sells shares to the public so anyone can buy them (3 letters).
What is an IPO? (or Initial Public Offering)
If you put $100 in a bank at 5% simple interest for 3 years, how much interest do you earn total?
What is $15?
It's important to know your risk tolerance before you start investing because...
So you create an investment portfolio that has an amount of risk you are comfortable with.
This major U.S. stock market index tracks the performance of 500 large companies and is often used to measure how the overall market is doing.
What is the S&P 500?
This type of account is set up by parents or guardians for a minor (kid or teen) to invest in until they become an adult.
What is a custodial account?
This is a way companies raise money by selling pieces of ownership to investors; people buy these hoping the company grows.
What is a stock?
Two ways to make money in the stock market:
What is Buying low/selling high and dividends
A retirement account where contributions might grow tax-free, named after a law (you can start one as a teen with earned income!).
What is a Roth IRA?
Dez is 24 years old. He makes $80,000/year, has money in his Emergency Fund & has extra income each month after he pays bills. What should be his investor risk level? (Conservative/Moderate/Aggressive)
What is AGRESSIVE
A special retirement account where you put in money that has already been taxed, and it grows tax-free for when you're older (great if you start young!).
What is a Roth IRA?
An index fund is a collection of___________________.
What is stocks.
This is the total gain (or loss) on an investment over time, often expressed as a percentage; compound versions grow much faster than simple ones.
What is return?
This strategy of not putting all your eggs in one basket helps lower risk in investing.
What is diversification?