1.  Equities

2. History  What were the first stocks?  Where were they traded?  Who traded them?

3. The First Stock Exchange  Where and when was the first stock exchange created?

4. Antwerp, Belgium (1531)

5. How it started…  Began as debt issuance  The concept of equity was not yet created  Market was made of debt  Some finance partnerships

6. East India Companies  As shipping boomed in the 1600s  Investors put money up  Received a share in the profits to lessen risk  LLC’s were formed

7. East India  East India companies fully established  Profit sharing?  First joint stock companies  Allowed companies to demand more  Size and royal charters meant huge profits

8. Coffee and stocks??  What do coffee and stocks have in common?  East India companies traded on paper  No stock exchange  How did people trade?

9. The South Seas Bubble  The riches did not last long …  The British East India Company & SSC (South Seas Company)  Other investors wanted a slice  No rules or regulations for issuances  Retaking sunshine from vegetables??  Bubble burst when SSC failed to pay dividends

10. The New York Stock Exchange  Philadelphia stock exchange  NYSE had geographically competitive advantage  In the heart of all business and trade coming in  Buttonwood Agreement

11. NASDAQ  Brainchild of National Association of Securities Dealers  Does not inhabit physical space  Increased efficiency  Reduced bid ask spread  Forced NYSE to evolve

12. Equities / Stocks  A type of security that signifies ownership in a corporation and represents a claim on part of the corporation’s assets or earnings  Ownership  Two types:  Common stock  Preferred stock

13. Liquidation  What you need to know about liquidation…  What is liquidation

14. Dividends  Distribution of corporate earnings  Given to shareholders at regular intervals  Different forms of issuance

15. Dividend Yields

16. Share Buybacks  A program by which a company buys back its own shares from the marketplace  Reduces the number of outstanding shares  Management thinks they are undervalued  Two options

17. Share Buybacks

18. Stock Splits  A corporate action in which a company divides its existing shares into multiple shares  Always by a specific multiple  Dollar value is unchanged  Why?

19. Stock Price  Supply and demand  Constant revaluations  Value Stock Price  Market Cap

20. Largest Companies by Market Cap

21. Apple $632.6 Billion

22. Google $400 Billion

23. Microsoft $358.1 Billion

24. Berkshire Hathaway $320.8 Billion

25. Exxon Mobil $316.5 Billion

26. Bid-Ask Spread Buy or sell: Buy Of what: EvanCo How many: 1,000 shares What price: $100 Buy or sell: Sell Of what: EvanCo How many: 1,500 shares What price: $125

27. Making the trade  Five types of orders:  Market Order  Limit Order  Day Order  Fill or Kill  Stop Order

28. Market Order  Can be filled at the market or prevailing price  Usually the first order to get filled  Generally reliable  One pitfall

29. Notorious Example

30. Limit Order  Buy or sell a certain amount of stock at a given price or better  Buy limit order  Sell limit order

31. Thank you!

32. News Recap