Types of Investments
what is a stock?
A small ownership share in a company
What does investing help you do over time?
grow your money
what is profit?
money you gain after investing
What does “risk” mean in investing?
The chance of losing money
what is saving?
the chance of losing money
What type of investment is done with a group of investors that pool their money together?
mutual fund
Investing sooner means you can _____________ sooner.
retire
a piece of ownership in a company or mutual fund.
What is a share
Which has more risk?
Certificates of Deposit or Stocks
stocks
This investment is a piece of property owned by a person who rents it out to another.
rental property
stock
What type of money should you never use to invest?
borrowed
Type of investment you do through your employer, and the employer usually matches your contribution by a certain percentage
401K
Would the risk be low or high to invest all your money in only one type of stock?
High
As the value of stocks go up, you may be paid that profit in cash or more stocks. This is called stock ________.
dividends
A reason investments make you more money for retirement than just having a savings account.
Greater return
One of the three major stock exchanges in the U.S.
NASDAQ, NYSE, AMEX
When you sell your stocks at a higher price than what you paid for them, you make a ___________
profit
Type of risky investment where you purchase a home that needs improvement with the intent of immediately reselling the home after you make the improvements.
House Flipping
These are a debt instrument where the issuer owes you money. They make regular interest payments and pay back the face value at a later date. The risk is lower than stocks.
Bonds
Type of investment that does not give you part ownership in a company, but instead loans the company your money in return for payback with interest.
bond
This is the best place to keep your emergency fund.
savings account
Term that means to spread around one’s investment dollars among several different classes of financial assets and among the securities of many issuers; results in lowered risk.
Diversification
True or False? Information, even if not true, can cause a stock's value to drop.
True
A list of your investments
portfolio