ECONOMICS C11: FINANCIAL MARKETS
Terms
undefined, object
copy deck
- What is Investment?
- The act of redirecting resources from being consumed today so that they may create benefits in the future.
- What is a Financial System?
- Includes savers and borrowers and allows the transfer of money between them to take place.
- What is a Financial Asset?
- Claim on the property or income of a borrower.
- What is a Financial Intermediary?
- An Institution that helps channel funds from savers to borrowers.
- What are Mutual Funds?
- A fund that pools the savings of many individuals and invests this money in a variety of stocks, bonds, and other financial assets.
- What is Diversification?
- Spreading out your investments to reduce risk.
- What are Portfolios?
- A collection of financial assets.
- What is a Prospectus?
- An investment report to potential investors.
- What is the Coupon Rate?
- The interest rate that a bond issuer will pay to a bondholder.
- What is Maturity?
- The time at which payment to the bondholder is due.
- What is Yield?
- The annual rate of return on the bond if the bond were held to maturity.
- What are Savings Bonds?
- Low-denomination bond issued by the United States government. Ex. a $50 bond will cost $25 & earn $25 interest at maturity yielding $50 payout
- What are Municipal Bonds (Munies)?
- Bonds issued by a state or local government or municipality to finance such improvements as highways, state buildings, libraries, parks, and schools.
- What is a Corporate Bond?
- A bond that a corporation issues to raise money to expand its business.
- What is the Securities and Exchange Commission?
- An independent agency of the government that regulates financial markets and investment companies.
- What is a Junk Bond?
- A lower-rated, potentially higher-paying bond with higher risk.
- What is a Capital Market?
- A market in which money is lent for periods longer than one year.
- What is a Money Market?
- A market in which money is lent for periods of less than a year.
- What is a Primary Market?
- A market for selling financial assets that can only be redeemed by the original holder.
- What is a Secondary Market?
- A market for reselling financial assets. More liquid for investors needs.
- What is a Share?
- Portion of stock
- What are Equities?
- Claims of ownership in a corporation.
- What is Capital Gain?
- The difference between a higher selling price and a lower purchase price, resulting in a financial gain for the seller.
- What is Capital Loss?
- An investor who sells stock at a price lower than the purchase price yielding a loss.
- What is a Stock Split?
- The division of a single share of stock into more than one share. Favorable to investors as the price of stock tends to rise after this happens.
- What is a Brokerage Firm?
- A business that specializes in trading stocks.
- What is a Stock Exchange?
- A market for buying and selling stock.
- What is the OTC (Over the Counter) Market?
- An electronic marketplace for stocks and bonds.
- What is Nasdaq ( National Association of Securities Dealers Automated Quotations)
- American market for OTC securities. Trading information broadcast to some 360,000 computer terminals worldwide.
- What is a Put Option?
- The option to sell shares of stock at a specified time in the future.
- What is a Bull Market?
- A steady rise in the stock market over a period of time.
- What is a Bear Market?
- A steady drop in the stock market over a period of time.
- What is "The Dow"?
- Index that shows how certain stocks have traded. Represent 30 large companies in various industries like food, entertainment & technology
- What is the " S & P 500 "?
- (Standard & Poor's 500) An Index that shows the price changes of 500 different stocks.
- What was the Great Crash?
- The collapse of the stock market in 1929. Black Tuesday (Oct. 29th 1929) a record 16.4 million shares sold compared with 4-8 million shares earlier in yr.
- What is Speculation?
- The practice of making high-risk investments with borrowed money in hopes of getting a return.