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Finance continued
| word | definition |
|---|---|
| Diversification | An investment strategy in which you spread among industry sectors. Reducing risk by combining different investments whose prices aren't likely to move in step with one another |
| Industry | A group of companies that makes the same products |
| Portfolio | A collection of investments owned by one individual or organization |
| Risk | The chance of losing all or part of the value in an investment |
| Bonds | An IOU that a company or government sells when it borrows money. Bonds are called fixed income investments because they pay a fixed amount of interest to the bondholder who purchases the IOU. |
| High Yield Bonds | To attract investors, the issuers of these bonds pay a higher rate of interest than investment grade bonds with the same maturity. They are rated below investment grade bonds and called 'Junk Bonds." |
| IOU | An acknowledgement of dept |
| Maturity | The day when the principal amount is payable |
| Par value | The principal amount of a bond due at maturity |
| Principal | Face amount of a bond, due at maturity |
| Trade Date | The day when purchase or sale of bond is transacted |
| Mutual Funds | Investment company that poll savers' money to invest in a variety of stocks and bonds. Professionals who research companies and buy or sell stocks actively manage them based on what they think is best for the shareholder. |
Created by:
rogersmr13
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