Personal Finance quiz

fundamental

\-price stocks based on future earnings

\-industry new products, state of economy

\-buy blue chip companies

\-hold for a long time (long term)

blue chip companies

companies that are financially sound and hold a good reputation in the market of having consistent growth

fundamental stock market theory

the fair market value is higher than the market price, the stock is deemed undervalued, and a buy recommendation is given

technical

\-look at graphs numbers and trends(patterns)

\-buy low and sell high

\-volume(how many shares bought/sold per day)

\-day trader(short term)

technical stock market theory

believe past trading activity and price changes of a security can be valuable indicators of the security's future price movements

efficient market

\-the stock market is random

\-all investors do their hw before buying stock

\-you can’t beat Dow Jones

Dow Jones

index average of the stock market

income stock

pays higher than average dividends compared to other stocks

growth

company who is doing way better than the typical stock on the stock market

cyclical

when economy is doing good, stock is good; when economy is doing bad, stock is bad

defensive

established comapany, steady dividends, remains stable during declines in the economy

penny stock

anything that sells for less than one dollar per share

capitalization

total amount of stocks a company has released

large cap

stock issued by company that issues a large amount of stock and has a large amount of capitalization

divdends

money the comes into company and then goes to investor

small cap stock

issued by company with capitalization of 500 million or less.