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41 Cards in this Set
- Front
- Back
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Common Stock
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Form of equity representing ownership
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Bonds
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Liabilities - IOUs of the issuer
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Preferred Securities
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Securities issued as stock but with fixed dividend rates
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Convertible Securities
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Fixed-income obligation (Bond or preferred stock)than be converted into common stock
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Mutual Fund
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Organization that invests in and professionally manages a diversified portfolio of securities
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Different Ways to Invest
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Common Stock, Bonds, Preferred and Convertibles, Mutual Funds, Real Estate,
Commodities, Financial Futures, Options |
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Commodities
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Contracts to buy and sell raw goods and materials
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Financial Futures
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Similar to commodities except the apply to certain types of financial instuments
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Derivative Securities
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Securities such as futures and options, whose value is derived from the price behavior of an underlying real or financial asset
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Prospectus
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A document made available to prospective clients that describes the firm and a new security issue
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Capital Market
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Long term securities
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Money Market
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Short term securities
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Primary Market
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Selling new issue to the public
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Secondary Market
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Investors executing transactions among themselves
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Listed
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A security that has met the prerequisites for, and thus is traded on, one of the organized securities exchanges
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OTC (Over the Counter) Market
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intangible relationship between buyers and sellers
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Unlisted Securities
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account for 40% of total dollar volume of domestic shares traded
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National Association of Securities Dealers Automated Quotation System
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Nasdaq
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Bid Price
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the price at which one can sell a security
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Ask Price
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the price at which one can purchase a security
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Securities Act 1933
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SEC (Securities and Exchange Commission)
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Bull Market
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Optimism (rising prices)
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Bear Market
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Pessimism (falling prices)
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full-service broker
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transactions + full array of services (Merril Lynch)
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Discount Broker
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low cost, little to no service for investors
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Online (electronic) Broker
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Transactions over the internet
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Securities Investor Protection Corporation (SIPC)
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Non profit subject to SEC and congressional oversight to protect investors against company failure
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odd lot
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fewer than 100 shares of stock
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round lot
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100 or multiple
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Brokers don't..
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manage portfolios
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Market Order
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Order to buy or sell security at best price available at time of placement
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Limit Order
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buy or sell above or below certain prices
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Stop-loss
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Sell below certain level
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Margin Purchase
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Purchase of securities with borrowed funds, the allowable amount of which is limited by the Fed (50%)
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Short Sale
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Transaction involving selling borrowed securities with the exception that they can be replaced at a lower price at some future date, anticipating decline
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Informed investors
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know what they're getting into, use annual stockholder's report, brokerage reports, and advisory services
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Stock split
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mitosis of shares without losing net value of holding
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Standard and Poor's (S&P)
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similar to DJIA, but different computation method
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Dow Jones Industrial Average
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Most widely followed measure of stock performance, 30 blue chips, mostly on NYSE
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New York Stock Exchange
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index of the performance of all NYSE listed stocks
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American Stock Exchange (AMEX)
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index of performance of all stocks listed on the American Stock Exchange
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