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42 Cards in this Set

  • Front
  • Back
the act of redirecting resources from being consumed today so that they may create benefits in the future
the system that allows the transfer of money between savers and borrowers
financial system
claim on the property or income of a borrower
financial asset
institution that helps channel funds from savers to borrowers
financial intermediary
fund that pools the savings of many individuals and invests this money in a variety of stocks, bonds, and other assets
mutual fund
spreading out investments to reduce risks
a collection of financial assets
an investment report to potential investors
the money an investor receives above and beyond the sum of money initially invested
the interest rate that a bond issuer will pay to a bondholder
coupon rate
the time at which payment to a bondholder is due
the amount that an investor pays to purchase a bond and that will be repaid to the investor at maturity
par value
the annual rate of return on a bond if the bond were held to maturity
low-denomination bond issued by the US government
savings bond
a bond issued by a state or local government municipality to finance such improvements as highways, state buildings, libraries, parks, and schools
municipal bond
a bond that a corporation issues to raise money to expand its business
corporate bond
an independent agency of the government that regulates financial markets and investment companies
Securites and Exchange Commission
a lower-rated, potentially higher-paying bond
junk bond
market in which money is lent for periods longer than a year
capital market
market in which money is lent for periods of less than a year
money market
market for selling financial assets that can only be redeemed by the original holder
primary market
market for reselling financial assets
secondary market
a portion of a stock
claims of ownership in a corporation
the difference between a higher selling price and a lower purchase price, resulting in financial gain for the seller
capital gain
the difference between a lower selling price and a higher purchase price, resulting in a financial loss to the seller
capital loss
the division of a single share of stock into more than one share
stock split
a person who links buysers and sellers of stock
a business the specializes in trading stocks
brokerage firm
a market for buying and selling stock
stock exchange
an electronic marketplace for stocks and bonds
OTC market
American market for OTC securities
contracts to buy or sell at a specific date in the future at a price specified today
contracts that give investors the choice to buy or sell stock and other financial assets
the option to buy shares of a stock at a specified time in the future
call option
the option to sell shares of stock at a specified time in the future
put option
a steady rise in the stock market over a period of time
bull market
a steady drop in the stock market over a period of time
bear market
index that shows how certain stocks have traded
The Dow
index that shows the price changes of 500 different stocks
S & P 500
the collapse of the stock market in 1929
Great Crash
the practice of making high-risk investments with borrowed money in hopes of getting a big return