Personal finance

shares if ownership in a corporation

represent loans to companies and goverments

you live within your income, you are able to save regularily, you use credit wisely, you carry adequate insurance

achieve financial goals, gain wealth and feeling of finacial security, increase income, meet retirement needs, maximize enjoyment of life

possibility that the investment will fail to pay any return to the investor

associated with owning only one investment of a particular type, this is bad because of uncomfortable or random factors

process of reducing risk by spending investment money among several investment opportunties, helps manage random risk

movement stocks and bonds generally move up and down

possibility that the investment will fail prehaps go bankrupt, result in a massive or total loss of ones invested funds

most important concern, danger that your money will not grow fast as inflation and therefore not be worth as much in the future as today

change that the value of an investment will decline when overall prices decline

sooner your invested money is supposed to return to you the less likelyhood that something could go wrong

economic growth usually does not occur in a smooth and steady manner and this affects profits as well as investment returns

investments are subject to sharp changes in prices as a result of events affecting a particular company or overall market

Speed and ease with which an asset can be coverted to cash

risk that the return on a future investment will not be the same as the return earned by orginal investment

fee's or percentages of the units or selling prices paid to sales pple agents, and companies for their services, buy or sell an investment

securities prices have risen 20% or move over time, more than 20 bull markets have seen an average gain of 136 percent

18 percent

securities market in which prices have declined value by 20% or more from prevous highs

four, started oct 2007

likelyhood of large price swings in their choosen securities

50%

buy stock wisely when they are under priced and sell them wisely when they rise above value

predict the short term movements of markets based predictions, move capital from one segment to another to capture gains and losses

buy and hold, dollar averaging, portfolio diversification, asset allocation

Investing regularily and not trading frequently will create a substantial portfolio overtime, dont react emotionally to changes

regularily monotoring, reacting emotionally to changes in the market

buy a widely diversified mix of stock and or mutual funds, reinvest dividends by buying more, stocks and mutual fund

hold onto those investment almost indefinetly

investing equal sums of money at regular investors

price of the investment

same stock of mutual fund regular intervals over a lng time

selecting different assets of investments, chosen for potential returns but also for their dissimal risk return characteristics

deciding on the proporotions of your investment portfolio that will be devoted to various categories of assets

corporation, public, privately held corporation

state chattered legal entity that can conduct business operations in its own name

issues stock purchased by the general public and traded on stock markets

basic form of ownership of a corporation

corporation will be profitable enough that income will exceed expenses, thereby allowing the firm to pay expenses

market price of a share stock, which the current price that a buer is willing to pay a willing seller, will increase overtime

common stockholders have a right to share in the income and assets of a corporation only after higher priority claims are satisfied

type of fixed income ownership security, in a corporation, owners recieve dividend per share, rarely have voting, no changes in dividends

interest rates

interest bearing negotiable certificate of long term debt issued by a corporation the us gov as a municiplality, IOU's

finance expensive construction projection and to purchase costly equtment investors lend the issuers a principal with two expectations

will recieve regular interest payments at a fixed rate of return for many years, they will get their principal returned a tsome pt

stock of a company whoose profits are greatly influenced by changes in the economic business cycle, prices of cyclical bonds relfect busines

exhibits price changes contary to movements in the business cycle

may not grow too quickly but yr after yr pays dividends higher than that offered by most companies

promise much higher profits tomorrow and has a consistent record of rapid growth in earning in economic conditions, low dividends

trade at low prices, value investor believes that the market isnt always efficient and that it is possible to find companies trading 4 less

company that has a potential for substantial earnings at the same time in the future, spotty future

technology secture

well know for being solid, relatively safe

issued more than 100 billion of stocks

substantial size 2 billion to 10 billiob in size, but not largest

distrubutions made in cash to holders of stock

dividend paid to an investor expressed as a percentage of the current market place of a security

standard units of trading of 100 shares of stocks

amount of a security that is less than the normal unit of trading for that particular security

reduces market risk, has lower returns generally

offer investors a reasonable certanity of regularly recieveing the periodic income and retriving the amount orginally invested

junk bonds, long term, high risk, high interest rate, corporate IOU's, issued by companies with poor or no credit

coupon rate, serial or sinking fund, secured or unsecure, registered and issued, book entity, callable

company that pools funds by selling shares to investors diversified investments to achieve financial goals of income or growth or both

per share value of a mutual fund

diversifaction, affordablility, professional manangement, liquidty, low transaction costs, uncomplicated investment choices

high liquid, safe securities with very short maturities

limit their investment to tax exempt municipal securities with maturities of less than 60 days

appeal to investors concerns about safety by investing solely to treasury bills short term securities backed the us gov

invest in securities maturing in one to five years

invest in treasury issues maturig in one to five years

invest investment-grad corporate securities with five to ten yrs

specialize in investment grade securities maturing in 10 to 30 yrs

invest in treasury and zero coupon bonds with maturities of ten yrs or longer

investing mortgage backed securities issued by agencies of the u.s gov

invest and high yield, high risk corporate bonds

invest in municipal bonds that provide tax free income

ubvest ub debt issue of only one state

investing debt securities offered by foreign corporations and govs

review investment policy , eliminate funds, inappropriate for investment goals

create portfolio of funds in which to invest, choose no load fund w/ low manangement fee's, obtain information and advice

screen, compare, and select funds that meet your criteria, monitor your portfolio of mutual funds

use portfolio monitoring on the internet, check fund quotations in newspaper

shareholders receive this amout per share when they redeem their shares the company is willing to pay this amount to buy shares back

price at which funds share can be purchased by investors