$$ Day 3 $$ In This Unit, You will be able to:  Understand & Explain the KISS rule of investing.  Examine the relationship between diversification and.

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$$ Day 3 $$ In This Unit, You will be able to:  Understand & Explain the KISS rule of investing.  Examine the relationship between diversification and risk.  Explain 20 investment terms & their importance.  Compare & contrast different types of investments: money markets, bonds, single stocks, rental real estate, annuities, and mutual funds.

What's the difference between: A tax deferred investment (the growth is not taxed until money is withdrawn) with earned income. Also, contributions are tax deductible. This is a retirement account that is funded with after-tax dollars...and... it grows TAX FREE! I.R.A. Roth I.R.A.

What's the difference between: A tax deferred investment (the growth is not taxed until money is withdrawn) with earned income. Also, contributions are tax deductible. This is a retirement account that is funded with after-tax dollars...and... it grows TAX FREE! Roth I.R.A.

What's the difference between: A tax deferred investment (the growth is not taxed until money is withdrawn) with earned income. Also, contributions are tax deductible. This is a retirement account that is funded with after-tax dollars...and... it grows TAX FREE!

Explain what ______ is.  C.D.  Dividend  Money Market  Risk Return ratio  Liquidity  Share

(1) Money is tied up (2) Low rate of return Money Market account Single Stocks A piece of ownership in the company It's a debt instument where the company owes you money with interest...very safe investment. What is one problem with C.D.'s? Where is the best place for your Emergency Fund? What is an investment that carries a HIGH degree of risk? What does a share of stock represent? What is a bond? Are they low or high risk?

(1) Money is tied up (2) Low rate of return Money Market account Single Stocks A piece of ownership in the company It's a debt instument where the company owes you money with interest...very safe investment. Where is the best place for your Emergency Fund? What is an investment that carries a HIGH degree of risk? What does a share of stock represent? What is a bond? Are they low or high risk?

(1) Money is tied up (2) Low rate of return Money Market account Single Stocks A piece of ownership in the company It's a debt instument where the company owes you money with interest...very safe investment. What is an investment that carries a HIGH degree of risk? What does a share of stock represent? What is a bond? Are they low or high risk?

(1) Money is tied up (2) Low rate of return Money Market account Single Stocks A piece of ownership in the company It's a debt instument where the company owes you money with interest...very safe investment. What does a share of stock represent? What is a bond? Are they low or high risk?

(1) Money is tied up (2) Low rate of return Money Market account Single Stocks A piece of ownership in the company It's a debt instument where the company owes you money with interest...very safe investment. What is a bond? Are they low or high risk?

(1) Money is tied up (2) Low rate of return Money Market account Single Stocks A piece of ownership in the company It's a debt instument where the company owes you money with interest...very safe investment.

Single Stocks Mutual Funds  One company  High degree of risk  Brokers  No diversification  Common person averages 7%  Investment  Publicly traded companies  Earn profits or dividends when the company makes a profit  Traded in shares  companies  Diversification lowers the risk  Investors pool their money  Professional portfolio managers  97% of 5yr periods have made money  100% of 10yr periods have made money  Many types of Investments  Not hard to find one that averages 12%  Bond, International, Growth

Single Stocks Mutual Funds  One company  High degree of risk  Brokers  No diversification  Common person averages 7%  Investment  Publicly traded companies  Earn profits or dividends when the company makes a profit  Traded in shares  companies  Diversification lowers the risk  Investors pool their money  Professional portfolio managers  97% of 5yr periods have made money  100% of 10yr periods have made money  Many types of Investments  Not hard to find one that averages 12%  Bond, International, Growth