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Investment Terms
list of terms and definitions for financial literacy at mountain view
26
Finance
12th Grade
12/02/2013

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Term
INVESTING
Definition
the use of savings to earn a finacial return
Term
INFLATION
Definition
rise in the general level of prices
Term
RULE OF 72
Definition
estimation of number of years required to double your money
Term
RISK
Definition
the chance that investment's value will decrease
Term
DIVERSIFICATION
Definition

 

spreading the risk amount many types of investments

Term
FINANCIAL ADVISERS
Definition

 

professional investment planners- give advice

Term
ANNUAL REPORT
Definition

 

summary of a corporation's finacial results for year/ prospects of the future

Term
BONDS
Definition

 

deby obligations of corporations or local governments

Term
DISCOUNT BOND
Definition

 

series EE savings bond- buy it for less than maturity value

Term
MUTUAL FUND
Definition

 

large, professionally managed group of investments

Term
ANNUITY
Definition

 

contact sold by an insurance company that provides investor with series of regulat payments

Term
STOCK
Definition

 

unit of ownership in a corporation

Term
FUTURES
Definition

 

contracts to buy and sell commoitites/ stocks for specified price on specific date in the future

Term
OPTION
Definition

 

the righ to buy or sell comodity/ stock for specified prics on a specific date in the future

Term
PENNY STOCKS
Definition

 

low priced stocks of small companies that have no track record

Term
STOCKHOLDERS
Definition

 

shareholders of the corporation

Term
DIVIDENDS
Definition

 

the distributions of corporations profits to shareholders

Term
CAPITAL GAIN
Definition

 

increase in value of stock over time

Term
COMMON STOCK
Definition

 

pays variable dividends; voting rights

Term
PROXY
Definition

 

written notification of intent (for voting)

Term
PREFERRED STOCK INCOME STOCKS
Definition

 

fixed dividend; no voting rights (higher dividends as well)

Term
GROWTH STOCKS
Definition

 

dividends are reinvested as stocks

Term
BLUE CHIP STOCKS
Definition

 

larger, more established companies

Term
PAR VALUE
Definition
assined dollar value of the intial offering of a stock
Term
MARKET VALUE
Definition

 

price investors are willing to pay

Term
EARNINGS PER SHARE
Definition
sell price: purchase price=(profit*shares)=baseprofit+(dividends*shares)=TOTAL PROFIT
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