1. What does stock represent?

Ownership of a corporation.

  1. What are Shares?

Shares are portions of stock in a company.

  1. What do companies do with the money they get from shareholders?

Expand, run, or start businesses.

  1. What are Equities?

Another name for stock.

  1. What are Dividends?

Money you get back from stocks.

  1. How often do you receive them?

Quarterly. (4 times an year)

  1. How is the size determined?

By corporation profits and number of shares.

  1. What are Capital Gains?

Difference between buying price and selling price. Gain in money.

  1. What are Capital Loss?

The opposite of Capital Gains.

  1. What is Income Stock?

Stock that pays regular dividends.

  1. What is a Growth Stock?

Reinvested dividends.

  1. What is a Common Stock?

Voting owners of of stock. Usually for board of directors.

  1. What is Preferred Stock?

Non inviting members and get dividends first.

  1. Explain what happens when a Stock Splits.

Each share splits into more than one. Usually when price is high and people aren’t buying.

  1. Why is purchasing stock risky?

Company can earn less or go bankrupt.

  1. Do stockholders always receive dividends?

No. Only if one is made.

  1. What is a Stockbroker?

Person who links buyers and sellers.

  1. What are Brokerage Firms?

Businesses that specialize in trading stocks.

  1. How do they make money?

Commission for each transaction and by lowering and selling to their investors for slightly higher prices.

  1. What is a Stock Exchange?

Markets for stock.

  1. What is the NYSE and how does it run?

Largest and most powerful. Buy seats and trade and exchange. The largest and most established.

  1. What are Blue Chip companies?

Stock high in demand cause of expected profits.

  1. What is OTC?

Over the counter (electronically) traded stock.

  1. What is NASDAQ and how does it operate?

Link Vs. Markets with Asia and Europes.

  1. What is Daytrading?

Try to predict minute by minute prices.

  1. What is the Bull Market?

Stock increases in value.

  1. What is the Bear Market?

Stocks decreasing.

  1. What is the DOW?

DOW Ind. Arg. Thirty companies that are representing the market since 1869.

  1. What is the S&P 500?

Broad pic. of stock performance. Tracks prices changes of 500 different stocks.

  1. What is the great Crash and what caused it?

The Great Crash is another name for the Great Depression. Buying on the margin and the actions in the twenties.