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| Answer |
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| Stock Market |
A general term used to describe all transactions involving the buying and selling of stock shares issued by a company. |
| Stock |
A share of ownership in the assets and earnings of a business. |
| Stock Certificate |
The piece of paper a shareholder receives representing their ownership of a stock. |
| Portfolio Diversification |
An individual who has a variety of investments tools to decrease risk. |
| Rate of Return |
The increase or decrease in the original purchase price of an investment. |
| Common Stock |
Shares or units of ownership in a public corporation. The shareholder has voting rights in the corporation. |
| Stock Split |
Shares owned by existing stockholders are divided into a larger number of shares. |
| Dividends |
Distributions of earnings paid to stockholders. |
| Preferred Stock |
Shares which pay fixed dividends and have precedence over common stock. |
| Market Price |
The amount a willing buyer will pay a willing seller for a stock. |
| Speculative Stock |
A very high risk stock from a company with potential for substantial earnings in the future. |
| Blue Chip Stock |
Stock from nationally recognized companies which dominate the industry often having annual revenue of $1 billion or more. |
| Book Value |
Net worth of a company. |
| Earnings Per Share |
How much income a company has available to pay in dividends and reinvest as retained earnings on a per share basis. |
| Price/earning Ratio |
Relationship between the price of one share of stock and the annual earnings of the company. |
| Stock Ticker Symbol |
A stock's abbreviated trading symbol name. |
| Dividends per Share |
Total cash paid to common stockholders per share. |
| High Selling Price |
Highest selling price of one share of stock from the previous day. |
| Low Selling Price |
Lowest selling price of one share of stock from the previous day. |
| Close |
The price of the last share sold for the day. |
| Dow Jones Industrial |
Oldest indicator of the ups and downs of the stock market. Lists the 30 leading industrial blue chip stocks. |
| Standard and Poor’s 500 Index |
Tracks the stock market activity for 500 stocks. |
| NASDAQ |
Monitors fast moving technology and financial services stocks. Usually the companies are smaller and transactions occur over an electronic market. |
| Bear Market |
The market is doing poorly and investors are not confident in the economy. Investors are not purchasing stocks and are selling what is already owned. |
| Bull Market |
The market is doing well and investors are optimistic about the economy and purchasing stocks. |
| Broker |
A person who is licensed to buy and sell stocks and provides investment advice and collects a commission on each purchase or sale. |
| New York Stock Exchange |
The oldest and largest exchange with the strictest company standards. |
| American Stock Exchange |
The second largest exchange with less stringent requirements allowing for younger smaller companies to be listed. |
| Regional Stock Exchange |
Stocks traded to investors who are living in a specific geographical area. |
Ch.18 LTI-MA 509
