i Flashcards
The rate of increase in price over a given period of time is known as
Inflation
This strategy lowers the selling price of a stock and encourages more stock purchasing
stock split
an investing technique where an investor uses dividends previously earned on a stock to buy more shares of the stock
dividend retirement
The ease with which an investment can be bought or sold without significantly impacting the price of the security is
Liquielity
The first step you should take when planning for your retirement is to establish
retirement needs
This investment pools the money of many investors to buy a large selection of securities
Mutual fund
The term given to an investment with the most risk to the investor of losing their money
Speculative
A calculation that estimates the number of years it takes to double your money at a specified rate of return
Rule of 72
If you bought 20 shares of ABC stock for
$15/share and sold all 20 shares a year later for $25/share what was your gross profit
200 dollars
A technique that reduces risk by allocating investments across various financial instruments
Diversification
This allows you to earn interest on the amount you saved plus any interest you have already earned
compounded interest
This retirement account type allows you to earn money tax deferred until you take the money out during retirement
Traditional IRA
The better choice for short term goals
savings
The organization that a company must register with before issuing stocks or bonds
Security & exchange comission
The amount of risk you are comfortable assuming in your investment portfolio
Risk tolerance
A share of ownership in company is known as
Stock
How do you make money on bonds you own
Interest
A loan to a government or corporation is known as a
Bond
This type of market is descried by a receding economy and a decline in the stock market
Bear
This type of market is described by expanding economy and a rise in the stock market
bull
The investment type consists of a mix of multiple stocks and helps you diversity
Index fund
What brokerage account can be opened by people under the age of 18 if a parent/guardian also signs onto the account
custodial account
What must the child have in order to open a custodial IRA account
taxable income or wages
Companies must register with this organizations to sell stock for their company
Securities and exchange commission (SEC)
Roth IRA
Pay tax now
Pay tax later
Traditional IRS
pretax deduction from payoll; pay tax when you tax money from account
401k
