| A | B |
|---|
| stock | piece of ownership in a company |
| share | one individual "piece" of stock |
| Dow Jones Industrial Average | composite number that represents the share prices of 30 U.S. “blue-chip” |
| NASDAQ | composite number that represents popular technology stocks |
| S&P 500 | measures 500 U.S. stocks that are supposed to be representative of the overall exchange |
| bull market | when stock prices are rising faster than their historical averages |
| bear market | when stock prices are falling faster than their historical averages |
| insider trading | when anyone, including employees, trades using non-public company information |
| day trading | process of buying and selling the same stock during one day. Professional day traders commonly trade many times per day |
| mutual fund | is a fund created by an investment company which combines money from many investors and invests it in a group of shares, bonds, or other investment vehicles |
| dividends | money that a company gives to its shareholders when it has extra profit |
| P.E. ratio | the price of a company’s stock divided by its Earnings Per Share |
| I.P.O | when a company issues shares to the general public for the first time |
| Dollar Cost Averaging | the act of buying the same dollar amount of a stock each month |
| Penny stocks | Less than $1 (or $5 in some cases) per share; generally higher risk stocks |
| Blue Chip stock | the stock of a large company that has a long history of stable operation and solid performance |
| SEC (securities and exchange commission) | the government agency responsible for protecting investors by monitoring and regulating brokers, dealers, and the bonds in the U.S. |
| market crash | happens when stock prices have dropped dramatically; most famous occured Oct 29, 1929 |
| 10% | historic rate of return on stocks |
| 8000 | approximate number of stocks available to buy on the exchange |
