Basics Of Trading Stocks Flashcards
What does NYSE mean?
New York stock exchange
What are the three primary exchanges where stocks are traded in the US?
NYSE, NASDAQ, Amex
What are ETFs?
(Exchange-traded funds)
Groups of stocks traded on the exchange under a ticker symbol
Do ETFs give investors the opportunity to buy foreign stocks?
Yes
What is ‘Bid and Ask’?
Bid = the most someone is willing to pay for a stock
Ask = the lease someone is willing to sell for a stock
What is bid-ask spread
Ask minus bid = bid-ask spread
The difference between bid and ask determines whether a trade happens
The larger the bid ask spread…
The less likely a trade is to happen
What is liquidity
How easy a stock is able to be turned into cash
The smaller a bid ask spread is…
The more often a stock trade occurs
What are the two types of orders?
Market orders and limit orders
What are market orders?
Market orders involve buying/selling a stock immediately regardless of the price
What are limit orders?
Buying/selling a stock automatically when a stock hits a particular price
