| A | B |
|---|
| Low risk low return | checking, savings, cds, money market |
| T-bills | treasury bonds - guaranteed from the Federal Government |
| Bonds | a debt instrument that is used for a pre-determined time and interest is paid to the bond holder |
| Types of bonds | government(Municipal,) corporate and junk |
| Stock | ownership in a company |
| Common stock | have voting rights and possible dividends |
| Dividend | profit that is given either as a check or to buy more stocks |
| Preferred stock | a part common stock/part bond which pays interest but does not have voting rights |
| Bull market | market is moving up |
| Bear market | market is moving down |
| Mutual fund | a financial product that is run by a financial manager who invests in a variety of stocks, other mutual funds, bonds, and businesses to make a profit for the members of the mutual fund. |
| American Stock Exchange (AMEX) | small caps and derivatives. |
| NASDAQ | virtual stock market |
| New York Stock Exchange (NYSE) | big board - large cap companies |
| Dow Jones Industrial Average (DJIA) | an index that shows how 30 large publicly owned companies based in the United States have traded during a standard trading session in the stock market. |
| Rule of buying stocks | Buy low and sell high |
| Futures contract | contracting to buy a product at a certain price at a certain time in the future |
| Annuities | contracted financial product that is designed to grown and payments paid out a specific time in the future |
| Medium risk and medium return | mutual funds, stocks, real estate |
| High Risk and High Return | collectables, futures contracts, options, and currency trading |
| Volatile market | market that goes up and down because of an act of God or economic problems |
| Collectibles | antiques, paintings, coins, sports cards and comic books |
| stocks | also know as securities and equities |
| Capital Gain | making a profit on stocks |
| Capital Loss | losing money on a stock |
| Sell stock or get a dividend | ways to make money on stocks |
| Risk and return | higher the risk then the higher return |
| Diversification | don't put all you eggs in one basket |
