BORSA VALORI Come si dice “Borsa valori” in inglese? Stock exchange Come si chiamano le azioni in inglese? Equities How can you define an equity? Equities are certificates issued by a company and representing its part ownership

EQUITY/EQUITIES There are many types of equities The most common form of equities: Ordinary shares (Britain) Common stocks (US) People who buy equities: Shareholders (Britain) Stockholders (US)

SALES When shares are offered for sale to financial institutions and the general public: Going public When shares are offered to outside investors (stock traders=operatori di borsa, analysts): Flotation (Britain) Initial Public Offering (IPO) (US)

WHY Why do investors buy stocks and shares? Investors buy stocks and shares in order to: Receive an income in the form of annual dividends Because they hope to make a capital gain by selling the shares at a profit

STOCK AND SHARES Nominal value: the price written on the share Market price: the price traded on the stock exchange

PRICE Is a share’s price constant or does it change? Price can change constantly during trading hours, because it depends on supply and demand (how many sellers and buyers there are). So we have: Bid (buying) prices Offer (selling) prices

PRICE How do you call the difference between bid prices and offer prices? Profit or mark-up: the spread or the difference between these prices

STOCK AND SHARES What do shareholders’ buying and selling decisions depend on? Shareholders’ buying and selling decisions depend on: The financial situation of the company The situation of the industry in which the company operates The state of the economy in general The beliefs of the investors: whether they think the price will rise or fall

SPECULATORS Who are the speculators? People who buy and sell shares rapidly (day traders), hoping to make a profit instead of ordinary investors who keep their shares for a long period

INDEXES What are indexes? Stock markets are measured by stock indexes such as Dow Jones Industrial Average (DJIA) in New York, and the FTSE 100 index (Footsie) in London. They show changes in the average prices of a selected group of important shares.

INVESTORS Bulls: those who expect prices to rise Bears: those who expect prices to fall Bull market: a period when most of the shares on a market rise Bears market: a period when most of the shares on a market fall