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Making Dough
The Basics
Organizations to Know
Stock Stock and More Stock
Wild Cards!
100
This is the return of an investment provided over a period of time, expressed as a time weighted annual percentage.
What is Annualized Return?
100
This is the arrangement of characters (usually letters) representing a particular security listed on an exchange or otherwise traded publicly.
What is a Ticker or Symbol?
100
This is the independent, unaffiliated research company that rates fixed income securities. Example: AA, A, B, etc.
Who is Moody?
100
This is a stock's dividend as a percentage of the stock price. XX = Annual Dividend / Current Stock Price.
What is the Yield
100
This term represents the excess of the company's assets over its liabilities. In simple terms, this information tells you how much money would be left for shareholders if the company were to immediately liquidate, sell all its assets and pay off all its liabilities. This metric is widely used by value investors to determine if a company is an attractive investment opportunity. If the market value of a company's shares is below this, then the company is trading at a significant discount.
What is Book Value?
200
This is a taxable payment declared by a company's Board of Directors and given to its shareholders out of the company's current or retained earnings, usually quarterly.
What is a dividend?
200
What is the valuation ratio of a company's current share price compared to its per-share earnings. Calculated as: Market Value per Share/ Earnings per Share (EPS)
What is the P/E ratio?
200
This is the government commission created by Congress to regulate the securities markets and protect investors. In addition to regulation and protection, it also monitors the corporate takeovers in the U.S.
What is Securities Exchange Commission (SEC)
200
This is the aggregate value of a company or stock, determined by multiplying the number of shares outstanding by their current price per share.
What is Market Capitalization? For example, if XYZ company has 15,000,000 shares outstanding and a share price of $20 per share then the market capitalization is 15,000,000 x $20 = $300,000,000. Generally, the U.S. market recognizes three market cap divisions: large cap (usually $5 billion and above), mid cap (usually $1 billion to $5 billion), and small cap (usually less than $1 billion), although the cutoffs between the categories are not precise or fixed.
200
This term represents the first sale of stock by a private company to the public. This is often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately owned companies looking to become publicly traded.
What is an Initial Public Offering (IPO)
300
This is the amount of profit that a company produces during a specific period, which is usually defined as a quarter (three calendar months) or a year.
What are Earnings?
300
This is the portion of a company's profit allocated to each outstanding share of common stock.
What is EPS?
300
This is an index of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. This is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe.
What is the Standard and Poors (S&P)
300
What is the term for the return an investment provides over a period of time, expressed as a time-weighted annual percentage. Sources of returns can include dividends, returns of capital and capital appreciation. The rate of this is measured against the initial amount of the investment and represents a geometric mean rather than a simple arithmetic mean. These are the de facto method for comparing the performance of investments with liquidity, which includes stocks, bonds, funds, commodities and some types of derivatives. Different asset classes are considered to have different strata of annual returns.
What is Annualized Return?
300
This term is synonymous with a market that is going down
What is a Bear Market?
400
This occurs when a company's reported quarterly or annual profits are above or below analysts' expectations.
What is an Earnings Suprise?
400
This is an area of the economy in which businesses share the same or a related product or service.
What is Sector?
400
This is a computerized system that facilitates trading and provides price quotations on more than 5,000 of the more actively traded over the counter stocks. Created in 1971, this was the world's first electronic stock market.
What is the National Association of Securities Dealers Automated Quotation (NASDAQ)?
400
This is when an increase in the number of outstanding shares of a company's stock, such that proportionate equity of each shareholder remains the same.
What is a stock split?
400
This term is used when the market is going up.
What is a Bull Market?
500
What is the current quoted price at which investors buy or sell a share of common stock or a bond at a given time?
What is Market Price?
500
This is a classification that refers to a group of companies that are related in terms of their primary business activities.
What is Industry?
500
The origin of this organization can be traced to May 17, 1792, when the Buttonwood Agreement was signed by 24 stockbrokers in New York under a buttonwood tree on Wall Street. The first central location of this organization was a room, rented in 1792 for $200 a month, located at 40 Wall Street. It is by far the world's largest stock exchange by market capitalization of its listed companies at US$14.242 trillion as of Dec 2011.
What is the New York Stock Exchange
500
This is one of the operating measures most used by analysts and is a measure of a company's operating performance. Essentially, it's a way to evaluate a company's performance without having to factor in financing decisions, accounting decisions or tax environments.
What is the Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
500
This is the amount of money a business has on hand. In business as in personal finance, this is essential to solvency. This can be presented as a record of something that has happened in the past, such as the sale of a particular product, or forecasted into the future, representing what a business or a person expects to take in and to spend. This is crucial to an entity's survival.
What is Cash Flow?