Stocks & Bonds Flashcards
A is a share in the ownership of a company, representing a claim on the company’s assets and earnings
stock
A is a person who holds a company’s stock, and this means that person is one of the many owners or shareholders of the company.
stockholder
A stockholder’s return on his/her investment is called dividend
The __________________ regulates the stock market in the country.
Philippine Stock Exchange (PSE)
A stock certificate is a proof of ownership, which represents a stock. Stocks are bought and sold in a stock exchange, also called the
stock market.
The original price set by a company for stocks when they are first issued is called __ _____
par value
is bought to grant credit to a company
bond
of the bond on the front of the bond;
the face value or denomination
on which the loan will be repaid
redemption date or maturity date
which the bond pays on its face value at regular time intervals until the maturity date
bond rate or coupon rate
which is the amount promised to be paid on the redemption date
redemption value
gives the owner the right to share in the profits and to vote on company policy.
Common stock
pays the owner a fixed percentage of the stock’s par value each year
Preferred stock
is the remaining amount of profit of the company after stock dividends are subtracted.
Retained earnings
are indicators of the value of a certain stock used to quantify and compare relative values of stocks and bonds.
Market indices
Ratio of annual dividend to price per share
Stock Yields (percent yield)
Ratio of annual dividend to current price
Current Yield
Ratio of net income to number of outstanding shares
Earnings per Share (EPS)
Ratio of price per share to annual earnings per share
Price-Earnings Ratio (PE ratio)
Ratio of total gains to total cost
Rate of Return on a Stock Investment
Market Indices for Bonds
Bond Yields (percent yield)
Current Yield
Approximate Yield to Maturity
is the amount of annual interest
I
is the par value of bond
P
the cost or current price
C
is the number of years to maturity
n
Ratio of annual dividend to price per share
Bond Yields (percent yield)
Ratio of annual dividend to current price
Current Yield
The _____________ holds that stocks are already accurately priced and they reflect all available information about companies
Theory of Efficient Markets
The ____ _____ assumes that current stock prices fully reflect all historical information, including past returns.
weak form
The ______ ___ assumes that stock prices fully reflect all historical information and all current publicly available information
semi-strong form
The ________ states that prices reflect not just historical and current publicly available information, but insider information, too
strong-form
