| A | B |
|---|
| Private Corporation (closely held Corp.) | A corporation whose shares are owned by a relatively small group of people, & not openly traded on stock markets. |
| Public Corporation (publicly held) | A corporation that sells its shares openly in stock markets where anyone can buy them. |
| Proxy | a document that transfers a stockholder's voting rights to someone else. |
| Preemptive Right | Gives current stockholders the right to buy any new stock the corporation issues before the stock is offered to the general public. |
| Stock Split | A process in which the shares of stock owned by existing stockholders are divided into a larger # of shares. |
| Par Value | An assigned (often random) dollar value that is printed on a stock certificate. |
| Blue Chip Stock | Considered a safe investment that generally attracts conservative investors. |
| Income Stock | Pays higher-than-average dividends compared to other stock issues. |
| Growth Stock | Issued by a corporation whose potential earnings may be higher than the average earnings predicted for all of the firms in the country. |
| Cyclical Stock | Has a market value that tends to reflect the economy. |
| Defensive Stock | A stock that remains stable during declines in the economy. |
| Large Cap Stock | Stock of a corporation that has issued a large # of shares of stock and has a large amount of capitalization. |
| Capitalization | The total amount of stocks & bonds issued by a corporation. |
| Small Cap Stock | Issued by a company with a capitalization of $150 million or less. |
| Penny Stock | A stock that typically sells for less than $1 per share. Can go as high as $10/share. |
| Bull Market | Occurs when investors are optimistic about the economy & buy stocks. |
| Bear Market | Occurs when investors are pessimistic about the economy, & sell stocks. |
| Total Return | A calculation that includes the annual dividend as well as the increase or decrease in the original purchase price of the investment. |
| Earnings Per Share | A corporation's net (after tax) earnings divided by the number of outstanding shares of common stock. |
| Price Earnings (PE) Ratio | The price of one share of stock divided by the corporation's earnings per share of stock outstanding over the last 12 months. |
| Primary Market | A market through which an investor purchases securities from a corporation through an investment bank or other representative of the corporation. |
| Initial Public Offering | Occurs when a company sells stock to the general public for the 1st time. |
| Secondary Market | A market for existing financial securities that are currently traded among investors. |
| Securities Exchange | A marketplace where brokers who represent investors meet to buy and sell securities. |
| Over-The-Counter (OTC) Market | A network of dealers who buy & sell stocks of corporations that are not listed on the securities exchange. |
| Account Executive | A licensed individual who buys or sells securities for clients. |
| Portfolio | Consists of all of the securities held by an investor. |
| Commission | A fee charged by a brokerage firm for the buying &/or selling of a security. |
| Market Order | A requesto to buy or sell a stock at the current market value. |
| Limit Order | A request to buy or sell a stock at a specified price. |
| Stop Order | A type of limit order to sell a particular stock at the next available opportunity after its market price reaches a specified amount. |
| Round Lot | 100 shares, or multiples of 100 shares of a particular stock. |
| Odd Lot | Contains fewer than 100 shares of stock. |
| Selling Short | Selling a stock that has been borrowed from a brokerage firm and that must be replaced at a later date. |
| Current Yield | The annual dividend divided by the investment's current market value. |
| Securities | All investments that are traded. |
