PRESENTED BY THE UCLA UNDERGRADUATE INVESTMENT SOCIETY Introduction to Investing
What is Investing? The Right Mindset Know Yourself Defining Investing “An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return.” - Benjamin Graham
How do we Invest? We Utilize a Financial Security What is a financial security? Originally used to refer financial instruments secured by an asset. In modern use, it can refer to all financial instruments regardless of if they are secured.
Financial Securities Can be broken down into three categories: Equity (stocks) Debt (bonds, debentures, etc) Derivatives (options, swaps, futures)
Investing Vehicles (Securities) Marketable Securities Stocks Bonds Options Commodities/Futures Foreign Exchange Treasury Bills Non-Marketable Securities EE and I Government Bonds Mutual Funds
Stocks and their trading Plain and simple, stock is a share in the ownership of a company. Stock represents a claim on the company's assets and earnings. As you acquire more stock, your ownership stake in the company becomes greater. Whether you say shares, equity, or stock, it all means the same thing. Discount Broker vs. Full Broker
How are stocks traded? NYSE Face-Face Floor NASDAQ OTC AMEX
What Causes Stock Prices to Change? Supply and DEMAND!!
The Bulls, The Bears And The Farm The Bulls The Bears The PIGS
Stock Market Concepts Technical Analysis
Stock Trading Concepts Continued Fundamental Analysis
Onto the Fundamentals How do go about doing this? Financial Statements Ratios
Balance Sheet
Income Statement
Statement of Cashflow
Statement of Owners/Shareholders Equity
All of the Ratios P/E Ratio Dividend Yield Current Ratio Quick Ratio (acid test) Earnings per Share ROI Effective Tax Rate
Other Esentials Market Capitalization Volume
Practice