| A | B |
|---|
| invesment | the act of redirecting resources from being consumed today so that they may create benefits for the future the use of assets to earn income or profit |
| financial system | the system allos the transfer of money between savers and borrowers |
| finanacial asset | claim on the property or income of a borrower |
| financial intermediary | institution that helps channel funds from savers to borrowers |
| mutual fund | fund that pools the savings of many individuals and invests this money in a variety of stocks bonds and other financial assets |
| diversification | spreading out investments to reduce risk |
| portfolio | a collection of financial assets |
| prospectus | an investment report to potential investors |
| return | the money an investor recieves above and beyond the sum of money initially invested |
| coupan rate | the interest rate that a bond issuer will pay to a bond holder |
| maturity | the time at which payment to a bond holder is due |
| par value | the amount that an investor pays to purchase a bond and that will be repaid to teh investor at maturity |
| yield | the annual rate of return on a bond if the bond were held to maturity |
| savings bond | low-denomination bond issued by the united states government |
| corporate bond | a bond that is a corporation issues to raise money to expand its businesses |
| junk bond | a lowe rated potentially higher paying bond |
| capital market | market in which money is lent for periods linger than a year |
| money market | market in which money is lent for periods of less than a year |
| primary market | market for selling financial assets that can only be redeemed by the original holder |
| secondary market | market for reselling financial assets |
| share | portion of stock |
| equities | claims of ownership in a corporation |
| stock broker | a person who links buyers and sellers of stock |
| brokerage firm | a business that specializez in trading stocks |
| stock exchange | a market for buying and selling stock |
| otc market | an electronic and market place for stocks and bonds |
| nasdaq | american market for otc securities |
| futurers | contracts to buy or sell at a specefic date in the future |
| call option | the option to buy shares of stock at a specified time in the future |
| put option | the option to sell shares of stock at a specified time in the future |
| bull market | a steady rise in the stock market over a period of time |
| bear market | a steady drop in the stock market over a period of time |
| the dow | index that shows how certain tocks have traded |
| s&P 500 | index that shows the price changes of 500 different stocks |
| gret crash | the collapse of the stock in market in 1929 |
