Chapter 2 Flashcards
Fund mutual fund that seeks to provide maximum long tern capital growth from stocks of primarily smaller companies or narrow market segments; dividend income is incidental; the most volatile fund; also referred to as a small-cap fund.
Aggressive Growth Stock Mutual
contract sold by an insurance company, designed to provide payments to the holder at specified intervals, usually after retirement; the holder is taxed at the time of distribution or withdrawal, making this a tax deferred arrangement.
Annuity
a debt instrument where an insurer such as a corporation, municipality or government agencies owns your money; a form of I.O.U.; the insurer makes regular interest payments on the bond and promises to pay back or redeem the face value of the bond at a specified point in the future.
Bond
Certificate of Deposit usually at a bank; savings account with a slightly higher interest rate because of longer savings commitment.
CD
a food, metal or fixed physical substance that investors buy or sell, usually via future contract.
Commodities
To spread around ones investment dollars among several different classes of financial assets and among the security of many issuers; results in lowered risk.
Diversification
Distributions of a portion of a companies earnings, decided by the board of directories, to a class of its share holders; generally distributed in the form of cash or stock.
Dividend
types of annuity that guaranties a certain rate of return
Fixed Annuity
A term used to designate all contracts covering the sale of financial instruments or physical commodities for future delivery on a commodity exchange.
Futures
Account or arrangement in which one would put their money for long term growth; should not be withdrawn for a suggested minimum five years.
Investment
Funds that buy stocks in medium size companies that have experienced some growth and still are expanding; are also called a mid-cap fund.
Growth Stock Mutual Fund
Funds comprised of large, well established companies.
Larg-cap Fund
Quality of an asset that permits it to be converted quickly into cash without loss of value; availability of money; when there is no more liquidity, there is typically less return.
Liquidity
Fund Mutual fund containing a group of medium size companies that are growing.
Mid-cap
Mutual fund that seeks to maintain a stable share price and to earn current income by investing an interest baring instrument with short term maturities.
Money Market Fund
Pool of money managed by an investment company and invested in multiple companies, bonds, etc; offers investors a variety of goals depending on the fund and its investment character; often used to generate income on a regular basis or to preserve an investors money; sometime used to invest in companies that are growing at a rapid pace.
Mutual Fund
A list of your investments.
Portfolio
buying real estate to rent out as an investment.
Rental Real Estate
Degree of uncertainty of return on an asset; in business, the likelihood of loss or reduced profit.
Risk
Mutual funds that contain international companies.
International Stock Mutual Fund
Relationship of substantial reward in comparison to the amount of risk taken.
Risk Return Ratio
Accounts at financial institutions that allow Saving Account Accounts at financial institutions that allow regular deposits and withdrawal. The minimum required deposits, fees charged, and interest rates paid varies among providers.
Saving Account
Piece of ownership in a company or mutual fund.
Share
you are buying a small piece of ownership in a company.
Single Stock
Mutual fund that invest in companies who’s market value is less than 1 billion; largely consist of smaller, more volatile companies; also called aggressive growth stock mutual fund
Small-cap Fund
Purchasing risky investments that present the possibility of large profits, but also pose a higher-than average possibility of loss.
Speculative
The past history of something; with investments, look at the five or ten year record.
Track Record
Annuity that has a varying rate of return based on the mutual funds in with one has invested; also see annuity.
Variable Annuity
