Financial Literacy FINAL VOCABULARY By: Zack Clary

Stock The capital stock (or just stock) of a business entity represents the original capital paid into or invested in the business by its founders.

Dividends Dividends are payments made by a corporation to its shareholder members.

A capital gain is a profit that results from investments into a capital asset, such as stocks, bonds or real estate, which exceeds the purchase price.

Common Stock Common stock is a form of corporate equity ownership, a type of security.

Blue Chip Stock According to the New York Stock Exchange, a blue chip is stock in a corporation with a national reputation for quality, reliability and the ability to operate profitably in good times and bad.

Dow Jones Dow Jones & Company is an American publishing and financial information firm.

Futures Contract In finance, a futures contract is a standardized contract between two parties to exchange a specified asset of standardized quantity and quality for a price agreed today (the futures price or the strike price) with delivery occurring at a specified future date, the delivery date.

Option In finance, an option is a derivative financial instrument that specifies a contract between two parties for a future transaction on an asset at a reference price.

Bond In finance, a bond is a debt security, in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest (the coupon) to use and/or to repay the principal at a later date, termed maturity.

Mutual Fund A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors to buy stocks, bonds, short-term money market instruments, and/or other securities.

Commodity In economics, a commodity is the generic term for any marketable item produced to satisfy wants or needs.

Preferrd Stock Preferred stock, also called preferred shares, preference shares, or simply prefereds, is a special equity security that has properties of both an equity and a debt instrument and is generally considered a hybrid instrument.

NYSE The New York Stock Exchange (NYSE) is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at US$13.39 trillion as of Dec 2010.