| A | B |
|---|
| Direct Deposit | Involves an employer or financial institution placing your paycheck into a bank account. |
| Automatic Payroll | Having money withheld from your paycheck and sent directly to your savings is a plan called _________deduction. |
| Compound Interest | Interest drawn on the sum of the original principal plus interest is called |
| Interest | Money that is paid for the use of money is called _________. |
| Share Account | A regular account at a credit union is called a |
| Stockbroker | Investors buy and sell securities through a(n) _________, who works for a brokerage firm. |
| NCUA | Deposits kept in credit unions are insured by the _________. |
| FDIC | Federal insurance for depositors in commercial banks and savings and loans is provided by the |
| Risk | The greater the _________ you are willing to take, the more you stand to gain or lose. |
| Certificate of Deposit (CD) | Money set aside for a specified length of time at a specified rate is called a(n) |
| Money Market Account | A type of savings plan available through broker or investment firms, which is not covered by the FDIC, is called a(n) |
| Liquidity | The capability of financial resources being readily converted to cash is called |
| Principal | The amount of money you place in savings is called |
| Discretionary Income | is what you have left over to spend for what you wish (after your bills are paid each month). |
| Maturity Date | The day on which a certificate must be renewed or cashed in is called the |
| Early Withdrawal Penalty | When a CD is cashed before its maturity date, the depositor must pay a(n) |
| Annual Percentage Yield (APY) | The actual interest rate an account pays per year, with compounding included. |
| Short-Term Needs | Needs that can require an amount above your current paycheck that you may need in the next month, such as emergencies, vacations, and buying a car are called |
| Long-Term Needs | Needs that can require lots of money, such as home ownership, education, and retirement are called |
| Inflation | is a rise in the general level of prices. |
| Investing | is the use of savings to earn a financial return. |
| Diversification | The spreading of risk among many types of investments, ecspecially needed in beginning stages of investment is called |
| Rule of 72 | A formula used to estimate time or rate to double your money is called |
| Stock | represents ownership in a corporation. |
| Bonds | are debt obligations of corporations or a government. |
| Mutual Fund | pools money of many investors and buys a large selection of securities that has the advantages of professional management and diversification. |
| Futures | are contracts to buy and sell commodities for a specified price on a specified future date. |
| Options | is the right, but not the obligation, to buy or sell a commodity or stock for a specified price within a specified time period. |
| Public Corporation | issues stock that may be traded openly on the stock markets or over-the-counter. |
| Dividends | When a company is profitable, the stockholders often recieve a distribution of money called |
| Income Stocks | Stocks that pay high dividends over time are called |
| Growth Stocks | Stocks in companies reinvest profits, rather than pay dividends, are called |
| Stock Index | is a benchmark that stock investors use to judge investment performance. |
| Blue Chip Stocks | Stocks of large, well-established companies are called |
| Defensive Stock | Type of stock that remains stable in an economic decline |
| Cyclical Stock | Type of stock that does well in a good economy but poorly in a bad one. |
| Par Value | is an assigned , arbitrary dollar value that is printed on a stock certificate. |
| Market | When you buy stock, you pay ___________ value. |
| Earnings Per Share | A corporation's after-tax earnings divided by the number of common stock shares outstanding is |
| New York Stock Exchange (NYSE) | The largest stock exchange in the US. |
| Face Value | The amount a bondholder is repaid when a bond matures is called |
| Fixed - Income | Bonds are considered ____________ investments because a specified amount of interest is paid on a regular basis. |
| Registered bond | A bond that is recorded in the owner's name. |
| Coupon | or bearer bond is not registered in the owner's name by the issuer. |
| Issuer | The person or company that is giving the bond to the investor. |
| Debenture Bond | A bond backed only by the reputation of the issuing corporation. |
| Mortgage Bond | A bond also called secured bonds because they are backed by specific assets of the issuing firm. |
| Convertible Bond | A bond that can be exchanged for a specified number of shares of common stock. |
| Premium | When bonds sell for more than their face value, they are selling at a |
| Discount | When bonds sell for less than their face value, they are selling at a |
| Revenue Bond | A bond that is repaid from the income generated by a project that it is designed to finance. |
| Municipal Bond | Bonds issued by state and local governments are called |
| Investment-grade Bonds | This type of bond is high-quality because they are considered safe, stable, and dependable. |
| Junk Bonds | Coporate bonds with low or no investment rating, they are risky and speculative. |
| Common Stock | is a type of stock that pays a variable dividend and gives the holder voting rights. |
| Preferred Stock | is a type of stock that pays a fixed dividend and carries no voting rights. |
| Proxy | is a stockholder's written authorization to transfer his or her voting rights to someone else, usually a company manager. |
