FNCE 1
What is a bull market?
Investors are optimistic about nation's economy
More investors are buying stock and the stock market increases
what is a bear market
Investors are pessimistic about the nations economy. More investors are sellings stocks so that the market decreases
What is a index?
A index is a statistical measure of the changes in a portfolio of stocks representing a portion of the overall market
What is the indec that starts with a s
S&P/TSC Composite index
What is the index that starts with a D
Dow Jones composite index
What is the index that starts with N
NASDAQ composite indec
What is the index that starts with a S
Standards and Poor 500 stock
Why do investors purchase common stocks?
Income from dividends, Cash additional stocks or company products, Changes in stock value, Appreciate in value over time
Why do investors purchase preferred Stocks
Recieve cash dividends before common stock holdeers are paid any cash dividends, First claim on corporation assets.
What is fundamental Analysis
A way to value stocks by looking at the micro and macro factors that might influence the economic value of stocks
What is technical analysis
A idea that the value of a stcok and can be predicted by estimating price from historical patterns
What is a blue chip stock
Safe investments in strong and respected companies, Attracts coservative investors, EX Bell canada, royal bank
What is income stock
Pays higher then average dividends (ex.Utility stock)
What is growth stock
Less then 30% of earnings are paid out as dividents with rest reinvested in research and development. Eg. Southwest Airlines, Home depot
What is cyclical stock
Follows the business cycle of advances and declines in the economy ex automobiles, timber, steel
Defensive stock
Remains stable during the declines in the econoy. EX Kellogg, procter & Gabmle and utility stocks
Large cap stocks
Issed by a large corporation that has a large amount of stock outstanding & a large amount of capitalization
Capitalizaiton
The total amount of securities stocks and bonds issued by a corporation
Small cap stocks
Issued by a company that has a capitalization fo $150 millon or less
Penny stocks
Sell for less then $1per share
What is beta
A index that compares risk associated with a specific stock issue with the risk of the stock market in general. beta<1 = lower then average risk, beta = 1 average risk, beta > 1 higher then average risk