topic 5 Valuing Stocks

Question 1

what are Common Stock?

Answer 1

Represents ownership in a corporation

Question 2

what are 3 Major US stock market indexes?

Answer 2

Dow Jones Industrial Average-tracks largest 30 companies

S&P 500-tracks largest 500 companies

NASDAQ Composite Index-tracks technology firms

Question 3

what are 3 Major EU stock market indexes

Answer 3

dax-30 largest German
companies

CAC 40- 40 largest Paris companies

FTSE 100- 100 largest companies in London

Question 4

in trading what dose the spread refer to??

Answer 4

Bid-ask / bid-offer / buy-sell – the difference between the two is called the spread

Question 5

what is a market order

Answer 5

is an order to buy or sell a security at the going market price executes instantly

Question 6

what is a limit order

Answer 6

a direction given to a broker to buy or sell a security or commodity at a specified price or better:

Question 7

what are preferred stocks

Answer 7

hybrid security that has both long term debt and common stocks

Question 8

what’s the spread mean

Answer 8

the differences between the ask and the bid price