Exam 1: Cards 1 - Intro To Finance

Front 1

Accounting Equation

Back 1

Assets = Liabilities + Equity

Front 2

Jobless Claims

Back 2

Unemployment benefits from the government. Last 6 - 12 months.

Front 3

ADP (Private Report)

Back 3

The number of jobs created monthly. A nice ADP percentage is 7%.

Front 4

Stock: Definition

Back 4

Equity Investment in a company (ownership).

Front 5

Stock Splits

Back 5

Splitting number of stocks to make price more affordable (e.g. 100 stocks of $40 to 200 stocks of $20

Front 6

Reverse Splits

Back 6

Splitting stock that's going downward in order to make it more valuable (e.g. 100 stocks of $40 to 50 stocks of $80)

Front 7

Public vs. Private Companies

Back 7

Private companies are closed to the public (In-N-Out Burger). Public companies are open - Apple

Front 8

Public Sector is Ran by __________

Back 8

The government.

Front 9

Private Sectors

Back 9

Run by privatized industries but can also be run by the government.

Front 10

Net Income

Back 10

Revenue - Expenses = Net Income

Front 11

IPO Stock

Back 11

Initial Public Offering. The price that the stock is offered at initially.

Front 12

Stocks: Traditional Method

Back 12

Underwriting firms buys all the companies shares and then resells them.

Front 13

Dutch Action

Back 13

Investors Submits a bid. (Google).

Front 14

Secondary Offerings

Back 14

Additional Offering used to raise capital.

Front 15

Repurchases

Back 15

A company buys back its own stock from the market. (Michael Dell - majority shareholder of his own company)

Front 16

Tender Offer

Back 16

A company makes an offer on another company's stock.

Front 17

10Q

Back 17

Quarterly financial statements filed with the SEC.

Front 18

10K

Back 18

Annual financial states filed by the SEC

Front 19

NYSE

Back 19

New York Stock x-change - oldest most traditional market.

Front 20

NASDAQ

Back 20

National association of securities dealers automated quotations - online, no central trading floor.

Front 21

SEC

Back 21

The securities and exchange commission is the federal agency that regulates the stock markets.

Front 22

DOW

Back 22

The DOW is an index - NOT an exchange.

Front 23

PE Ratio

Back 23

Current stocks/EPC

Front 24

Shorting Stock

Back 24

You get money from the stock, but you have to pay it back. If it's going down, you want to buy.

Front 25

Debt to Equity Ratio

Back 25

Total debt value of outstanding shares

Front 26

Financial Press Release

Back 26

Tells you what a company is currently doing (buying, selling etc.)

Front 27

Bull Market

Back 27

Stocks are 20% up

Front 28

Bear Market

Back 28

Stocks/Market are 20% down

Front 29

Diversification

Back 29

you want to diversify your stock. Don't put all your eggs in one basket.

Front 30

Buy & Hold

Back 30

A passive strategy where investors buy and hold on to stock regardless of the movement of the stock

Front 31

Dollar-cost-Average

Back 31

Investing fixed-dollar amounts over a period of time.

Front 32

Cyclical Stocks

Back 32

A stock that rises quickly when there is economic growth, and falls rapidly when it falls.

Front 33

Market Capitalization

Back 33

The price of the stock times the number of shares

Front 34

Defensive Stocks

Back 34

A stock that remains stable under economic conditions. These stocks hold up in hard times.

Front 35

Growth Stocks

Back 35

Shares that are expected to grow at an above-average rating.

Front 36

Value Stocks

Back 36

A stock that tends to trade at a lower price relative to its fundamentals and it's considered undervalued.

Front 37

First step in finances

Back 37

Pay Tithing

Front 38

Margin

Back 38

Money given to you that you have to pay back. Buying on the margin is risky.

Front 39

Buying on the Margin

Back 39

Using borrowed money to purchase stocks.

Front 40

Percent of divorces due to financial disagreements

Back 40

89% of Divorces can be traced to financial problems

Front 41

Biggest Mistake in seeking financial advice

Back 41

The biggest mistake in seeking financial advice is to not

Front 42

Financial Goals are always short term: True or False

Back 42

False

Front 43

Three types of of financial goals for future

Back 43

Short Term, Mid-term, Long term

Front 44

EB/TDA

Back 44

Earnings before taxes, depreciation and ____

Front 45

Financial plans are set in stone: T/F

Back 45

False

Front 46

Net Worth Equation

Back 46

Assets - liabilities = net worth

Front 47

Accounting Equation

Back 47

Assets = liabilities + owner's equity

Front 48

A "Snapshot" in time

Back 48

Balance Sheet and Net Worth statements

Front 49

Temporary Statements

Back 49

Cash Flow Statements/Income Statements

Front 50

_______ forecast for the future

Back 50

Budgets

Front 51

The Financial Planning Process

Back 51

1. Determine your current financial situation (A Net worth Statement)
2. Develop Financial Goals
3. Track Actual Expenses, set budgets to achieve goals.
4. Create and implement financial plan.
5. Review and revise financial plan (things change with time).