Personal Finace - Investing

Lending money to a company and they pay you interest

Bonds

Anyone can buy stock

Public corperation

Symbol that a company is traded under

Stock ticker

Individual retirement account set up to help you save for retirement

IRA

Digital Currency

Crypto currency

Buys stock and becomes owners

Shareholder/Investor

Legal entity business that offers shares of stock

Corperation

A prolonged downturn in stock prices

Bear market

The number of years it takes for a certain amount to double in value is equal to 72 divided by its annual rate of interest.

Rule of 72

Regulates financial markets

Securities and Exchange Commission (SEC)

Proof of ownership in a corporation

Stock certificate

A pool of money invested in a variety of stocks, bonds, and other securities by a professional fund manager

Mutual funds

Licensed individual who trades stock

Stock broker

Places where buyers and sellers meet to sell stocks

Stock exchange

Illegally using inside information to make financial gain on a publicity traded company

Insider trading

Ownership of a fraction of an issuing corporation

Stocks

Using our money to make more money

Investing

A sustained period when stock prices rise

Bull market

Retirement account through your employer. Comes straight from paycheck.

401K

Select individuals buy stock

Private corperation

Fixed some of money paid to yourself each year

Annuities

Single company that owns another company

Parent company

Buying and selling raw material goods or agricultural products

Commodity trading

Measure of the up and downs of the market or a single company

Volatility

Why would it be important to include investing in your Financial Plan?

Lead to a satisfying retirement, Way of beating inflation

What are some things you could do to maximize your investments?

Invest for a long term period of time 5+ years, Reinvest all earnings (compound interest), Diversify

What is the Time Value of Money (general concept)?

Over time money compounds and grows

What is the INITIAL amount you deposit into your investments called?

Principal

What are the two main U.S. stock exchanges?

New York Stock Exchange, NASDAQ

Name two major things that could impact a stock’s price

Company’s financial health, Economic factors

Business Cycle / Economic Cycle – Be able to identify on graph and explain each phase.

Recovery (Economy is improving), Prosperity (peak of economic activity), Recession (downturn in the economy), Depression (bad times – usually does not occur)