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Unit 5
Entrepreneurship
Term | Definition |
---|---|
Annual Percentage Yield | the actual interest rate an account pays per year |
Blue chip stock | stock of an established and historically successful corporation |
Bond | a written promise to pay a debt by a specified date |
Brokerage firm | a company that specializes in helping people buy and sell stocks and bonds |
Capital gain | profit earned from selling stock at a price higher that its purchase price |
Capital loss | the amount lost if selling stock at a price lower than its purchase price |
Certificate of Deposit | a deposit in a savings institution that earns a fixed interest rate for a specified period of time |
Commercial bank | a financial institution that serves individuals and businesses with a variety of accounts, loans, and other financial services |
Common Stock | a voting share of stock that does not pay a set dividend |
Compound interest | interest paid on the principal and also on previously earned interest, assuming that the interest is left in the account |
Credit Union | a financial institution that offers memberships to people who share a common bond, such as people in a particular profession, company, church, or labor union |
Diversification | investing in various businesses with different levels of risk |
Dividend | a share of corporation's profit paid to its stockholders based on the number of shares of stock owned |
Face Value | the amount printed on a bond |
High-Yield Bond | high-return, high-risk bonds or junk bonds |
Insider trading | trading stock based on information that is not available to the general public |
Investing | saving in a way that earns income |
Load | sales fee paid when investing in a mutual fund |
Money market account | deposit for which the interest rate changes over time |
Mutual fund | business that accepts deposits from many people and invests them in a variety of ways |
Preferred stock | a non-voting share of stock that pays a fixed dividend |
Principle | money on deposit in a savings account, CD, or other savings options |
Prospectus | a publication that describes how a fund is operated, the fund's investing objectives, and the fees it charges |
Return | income earned on an investment |
Risk | the chance that an investment will decrease in value |
Savings | money that is put aside for a later use |
Savings account | an account offered by any savings institution in which money is deposited, interest is earned on the deposits, and the money can be withdrawn at any time |
Savings bond | a US government bond issued for amounts of 50 to 10,000 USD |
Securities and Exchange Commission | the government commission responsible for enforcing the laws concerning the trading of stocks and bonds |
Share of stock | a unit of ownership in a corporation |
Simple interest | the amount paid on the average balance in an account once a year at the end of a year |
Stock exchange | the location where orders to buy or sell stock are sent and carried out |
Stock transaction | when shares of stock are bought and sold |
Stockbroker | a person who handles the transfer of stocks and bonds between buyer and seller |
Stockholder | an investor who owns part of a corporation because he or she owns shares of stock |