| A | B |
|---|
| Annual Percentage Rate(APR) | the percentage amount of interest that will be charged to the customer each year for a loan or credit card balance |
| Bear Market | a market in which the existing conditions are likely to drive down stock prices |
| Bond | type of investment in which you lend or loan money to a company, government, or organization for a specific period of time at a specific interest rate |
| Bull Market | a market in which the existing conditions are likely to drive up stock prices |
| Capital Gains | when you sell an asset at a higher price than you paid for it, the difference is your capital gain. For example, if you buy 100 shares of stock for $20 a share and sell them for $30 a share, you realize a capital gain of $10 a share, or $1,000 in total |
| Collectibles | items that are relatively rare that people collect in hopes that they will increase in value |
| Common Stock | stock in a corporation. Your shares represent ownership and give you the right to vote for the company’s board of directors and benefit from its financial profit through dividends and/or capital gains |
| Diversification | an investment strategy in which you spread your investment dollars among different sectors, industries, and securities within a number of asset classes in order to balance and/or reduce the level of risk |
| Dividend | distribution of the after-tax earnings that are distributed to company’s shareholders |
| Earnings per Share | the amount of earnings per each outstanding share of a company’s stock (net income/outstanding shares). This number is one indicator of a company’s profitability |
| Investing | act of purchasing assets (stocks, bonds, property) with expectation that they will increase in value over time |
| Liquidity | refers to the speed with which an asset can be sold without hurting its value. Cash is the most liquid asset because you can exchange it immediately with no change in its value. |
| Maturity Date | specified time in the future when the initial investment of the bond is returned to the bondholder |
| Mutual Fund | diversified portfolio of combined investments such as stocks, bonds, and other investments that is managed by an investment company |
| Preferred Stock | stocks that provide for a dividend that is paid before the dividends paid to common stock holders; preferred stock takes priority over common stock |
| Price to Earnings Ratio (P/E Ratio) | measure of the price paid for a share relative to the annual net income or profit earned by the firm per share. The P/E ratio is defined as market share price/earnings per share (EPS) |
| Profit (Investment) | money earned after subtracting an initial investment, commission, or fees paid, and any taxes paid |
| Rate of Return | earnings you receive from an investment, expressed as a percentage of the investment |
| Real Estate | land or any item permanently attached to the land |
| Risk | refers to the likelihood that an investment will decrease in value. A high risk investment is one that usually has a higher possible rate of return, but also a higher possibility that it will lose money over time |
| Share | part ownership in a company |
| Stock | a certificate that represents a share of ownership in a company |
| Stock Market | marketplace or stock exchanges around the world where company stocks are bought and sold |
| Stock Symbol | letters or abbreviation that indicate a particular company stock |
