Investing in Stock Mrs. Wilson: Career & Financial Management.

Slides:



Advertisements
Similar presentations
Bellwork  Which is the best sneaker on the market? Why?  How do you know it is the best?  If it is the best, would you want to own all or part of that.
Advertisements

The Stock Market Economics.
 Ice cream and restaurant.  Opening new Frizzle’s around the world for the past five years.  One of the most popular ice cream restaurants in the.
Chapter 12 Personal Finance
Chapter 12 The Stock Market. CHAPTER 12  Who are the owners of a corporation?  Stockholders (shareholders)  If a corporation does well financially,
Investing in Stocks Chapter 12 Goals for Chapter 12.1 Describe the features of common stock and compare it to preferred stock. Discuss stock investing.
9.2 How to invest in corporations
1. Income stocks pay. Income stocks pay dividends at regular times during the year.
Key Terms from the World of Finance. Key Terms AMEX – Stands for American Stock Exchange. Located in New York City, this stock exchange sells memberships,
Investing: Taking Risks With Your Savings. Stocks are also known as securities As proof of ownership, you get a stock certificate Stocks What are they?
Investing: Taking Risks With Your Savings.  Part Owner of Corporation  Funds for expansion  Stock Returns ◦ Stockholders ◦ Dividend, return on investment.
Investing: Risking money to make money Chapter 2: Saving and Investing.
What are stocks? Represent a fraction of ownership in a corporation Referred as: – Shares – Equity – Stock.
Chapter 9 Section 9.3 – Buying and Selling Stock.
Personal Finance. Define stocks and analyze the benefits of investing. Evaluate stocks in order to get a return on an investment. Compare and contrast.
Stocks Chapter 9. Common and Preferred Stock 9.1 Objectives – How to identify the reasons for investing in common stock – How to identify the reasons.
Investing Bonds and Stocks. Setting Investment Goals  Investing presents opportunities for people and businesses to increase their income.  Investing.
 Goals:  Describe ways to purchase different types of stock.  Explain differences between investing in corporate stocks and corporate bonds.
Saving & Investing Achieving Financial Success. What does it mean? Saving  Putting money aside for future use Investing  Using money so that it earns.
(COMMON STOCK ANALYSIS)
The Stock Market In this lesson, students will be able to identify characteristics of the stock market. Students will be able to identify and/or define.
Rule of 72  Divide the number 72 by your investment’s expected rate of return.  Since the crash of the stock market, it has shown a return of 10%. 
Back to Table of Contents pp Chapter 31 Investing in Stocks.
Economics. October 24, 1929 Black Thursday Stock Investment that shows ownership.
Stocks, Bonds, and Futures Why Buy Stock? Gain a Profit Limit the Risk on their investment Become a part of a corporation Profit Potential Capital gain-
What is a Stock? F.H. O’Hara Adapted from 2006 Foundation for Investor Education. All rights reserved.Begin What is a Stock? F.H. O’Hara Adapted from 2006.
Before You Invest. For the purpose of personal finance corporations are either private or public. Private corporations are owned by individuals, families,
Understanding Stocks. What is a stock?  A share in the ownership of a company  When you own stock, you are automatically an “owner”/”shareholder” in.
Investing In Stocks Chapter 31. Today’s Schedule Tuesday’s Quiz Review Tuesday’s Quiz Review Assignment of Homework Assignment of Homework Chapter 31.
The Stock Market Understand the risks Describe how stocks are traded
INVESTMENTS. Means you give up the use of the money for a period of time in exchange for a chance to perhaps make even more money.
Do Now  If you didn’t finish your study guide on Friday, come up and get it. Finish answering the questions. We will correct them in a few minutes. 
Investing Continued.  A stock is a share of a stock  It entitles the buyer to a certain part of the future profits and assets of a corporation selling.
Financial Markets. Section 1  Investment- the act of redirecting resources from being used today so they can be used to create future benefits  When.
Chapter 11 Section 3 – The Stock Market. Buying Stock Stock or Equities – Represents ownership in a company Issued in portions called shares – Help corporations.
The Stock Market What you need to know to begin investing.
Which makes more sense? Why?  To sacrifice and put away $2,000 a year when you are 22 to 33 years old (12 challenging year of saving)OR  To wait until.
Bell Ringer #1 Ch What is the difference b/w a savings account and a time deposit? 2. After the stock market crash of 1929, ___________________ was.
  1. Can you drive on the left side of the road with your car?  2. Can you use your clothes to tie up a student and lock him or her in a locker? 
Chapter 11 Financial Markets.
Fact or Fiction 1. Only rich people invest money in the stock market. Fiction: anyone that has money can invest. 2. Stocks & bonds are always risky places.
 Preferred Stock  Common Stock  Stockbroker  Stock Exchange  Market Value.
Corporate Financing & Personal Investing. Terms for this chapter Bond Callable bond Common stock Convertible bond Cumulative preferred stock Diversification.
Corporations  Businesses can be publically or privately owned  Corporation – a company that is publically owned  stocks or bonds are sold to raise.
The Stock Market. What are stocks? A stock is a percentage of ownership in the company.
What is a Stock? BCHS Investment Club. Stock Represents a share of ownership in a publicly held company (privately held companies do not issue stock).
P604, Pay debts 2. Raise money  Ex. To expand business.
MORE FACTS ABOUT INVESTING PERSONAL FINANCE. EMERGENCY FUNDS  An ___________account needs to have a high degree of _______ and __________.  High safety.
The Stock Market 3.1 STOCK MARKET BASICS. Objectives.
Savings, Investments & the Stock Market. Saving and Investment  Saving Not consuming all current income Not consuming all current income Examples: Savings.
E. Napp The Stock Market In this lesson, students will be able to identify characteristics of the stock market. Students will be able to identify and/or.
 Publicly held corporation - one whose stock is widely held, has a large market, and is usually traded on the New York Stock Exchange or the American.
9.02 Summarize the investing in stocks and bonds. T H17.
What is a Stock? The Stock Market. Objectives: What is a Stock?  Explain why there is risk involved in stock ownership.  Make decisions as a group on.
Chapter 31 Investing in Stocks pp Learning Objectives After completing this chapter, you’ll be able to: 1.Define 1.Define stock. 2.Explain.
Investing Chapter 9. Investing Risk  The chance that an investment will decrease in value Return  The income you earn on an investment RATE OF RETURN.
Chapter Investing in Stocks Evaluating Stocks 12.
Chapter 12 Investing in Stocks. Evaluating Stocks  Characteristics of stock Public corporation – company whose stock is traded openly Stockholders (shareholders)
The Stock Market Bulls and Bears!. Stock Def. A portion of ownership in a corporation. It is a way for a corporation to raise money. Also known as shares.
Chapter 9 Section 3 Stocks, Bonds, and Futures Bw6FyPf34.
How do Stock Markets Work?. Stocks involve more RISK than Bonds.
The basics that we should know.  The use of long-term savings to earn a financial return.  Powerful way to strengthen your financial position over time.
STOCK MARKET. INVESTMENT  Definition- act of redirecting resources from being consumed today so they may create benefits in the future.
Theme 5: Investments.
List 1 expense that a business needs money for
Warm Up What does it mean when a person has stock in a company?
Stocks & bonds.
Financial Markets and Risk
Stock Personal Finance.
Investing in Stocks Chapter 31.
Presentation transcript:

Investing in Stock Mrs. Wilson: Career & Financial Management

Characteristics of Stock Nearly 50 million people in the US own stock More than 34,000 public corporations from which to choose A public corporation is a company whose stock is traded openly on the stock market

Stocks 101—What is Stock? A stock is a partial ownership in a corporation When you purchase shares of a stock, you purchase ownership in that corporation, with rights to share in its profits When a corporation needs to raise money for expansion or improvements, they will sell shares on the open markets The markets are the New York Stock Exchange (NYSE), the NASDAQ, and the American Stock Exchange (AMEX). There are several other markets as well

Why Invest in the Stock Market? Invest in the stock market to stay ahead of inflation and use the best way (verified by historical statistics), to increase your finances over time Research will show lower inflation brings higher returns to stocks and bonds For about the past thirty years the average return on stocks has been 8% Compare this to a passbook account at 3%, even with just 2% inflation, after paying 1% in taxes you will have (0) zero return

Stockholders Also known as shareholders Are the owners of the corporation If the corporation does well, the stockholders will profit in two ways

Ways shareholders profit… Dividends –The part of the corporation’s profits paid to stockholders Capital gain –This is an increase in the value of the stock above the price initially paid for it –For example, if you bought stock for $5 a share and it goes to $10 per share, you could sell it for a profit

Capital Loss Part of the risk of owning stock, however, is that the price could also go down below the price initially paid for it This is known as a capital loss

Trading Stocks Stocks are traded in round lots or odd lots Round lot –Is 100 shares or multiples of 100 shares of a particular stock Odd lot –Is fewer than 100 shares of a particular stock Brokerage firms charge slightly higher per-share fees for trading in odd lots. They MUST BE combined with round lots before they can be traded.

Common Stock The type of stock that pays a variable dividend and gives the holder voting rights The board of directors, elected by the stockholders to guide the corporation, decides the amount of the dividend each year They may vote but not manage; the more shares, the more power

Preferred Stock Is a type of stock that pays a fixed dividend and carries no voting rights Preferred stockholders earn the stated dividend, regardless of how the company is doing Preferred stock is less risky than common stock

Assignment Make a list of 10 stocks that you may be interested in purchasing Submit this list, typed, before the end of class