Investment in Stocks Flashcards
refers to the acquisition of shares in corporations with the goal of earning profit either through their sale or periodic dividends.
Investment in Stocks
Represents basic ownership in a corporation.
Common Stock
A portion of owners’ equity with preference over common stock in terms of dividends and asset claims.
Preferred Stock
Stocks are classified according to the business sector (5)
Financials
Industrials
Property
Services
Mining & Oil
Stable, well-established companies with consistent earnings.
Blue Chips
Companies expected to grow faster than the market.
Growth Stocks
Prices move with the economy (e.g., travel industry).
Cyclical Stocks
Earnings remain steady despite economic shifts (e.g., utilities).
Defensive Stocks
High-risk, high-reward stocks with future potential.
Speculative Stocks
Large companies with high market value
First Liners
Medium-sized companies
Second Liners
Smaller companies.
Third Liners
Traded on the stock exchange.
Listed Stocks
Not traded on the stock exchange.
Unlisted Stocks
(?) Stocks: For Filipinos only
Class A
(?) Stocks: Available to foreigners.
Class B
Nominal value stated on the stock certificate.
Par Value
Value based on the company’s books of accounts.
Value based on the company’s books of accounts.
Assets minus liabilities.
Net Asset Value
Where shares are bought and sold.
Stock Market
Organized marketplace (e.g., Philippine Stock Exchange).
Stock Exchange
Licensed individual/company facilitating stock trades for a commission.
Stockbroker
Buys and sells stocks for personal gain.
Stock Dealer
Processes payments and transfers between brokers
Clearing House
Manages ownership transfers and dividend payments.
Stock Transfer Agent
The speed at which stock prices change.
Price Volatility
Stock prices rise after a decline.
Technical Rebound
Prices drop after a rise due to the absence of good news.
Technical Correction
Lowest price a stock commands.
Price Support
Highest price a stock commands.
Price Resistance
Prices trend upwards; optimism prevails.
Bullish Market
Prices drop continuously; pessimism dominates.
Bearish Market