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17 Cards in this Set
- Front
- Back
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what is a share |
part ownership of a company - a share entitles you to dividends and you can vote at general meetings |
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how do you buy shares |
u can buy them on the share broker using a broker or broking service |
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how does the sharemarket work |
The stock market brings together buyers and sellers, enabling them to exchange securities, like shares, bonds, investment trusts
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how are the share prices determined |
a potential company will have more and higher priced shares but an unknown, not trusted company will have lots of shares at a small price, "the more you have to sell the lower the price" |
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advantages of investing in shares |
you can make a capital gain financial growth can make dividends |
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disadvantages in investing in shares |
if you buy at the wrong time legislative risk and volatity loss of capital gains |
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difference between a bull market and a bear market |
bull: when the share market is strong and prices are rising over a period of time bear: when the share market is weak and prices are falling over a period of time |
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capital gains and capital losses |
capital gain - a profit from the sale of property or an investment.
capital loss - A capital loss is the difference between the purchase price of an item and the price at which it sold at. |
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calculating capital gains as a percentage |
selling price x 100 - cost (now) x 100 the capital gain / original cost x 100 |
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dividends |
a sum of money paid regularly by a company to its shareholders out of its profits
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types of property investment |
apartments/units houses land - subdivide or build commercial building (factories) |
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advantages of investing in property |
- you can make some money by renting it out to people - capital gains - you as the landlord get to choose who lives in your place and how much you ask for in rent |
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disadvantages of investing in property |
- the tenants can destroy your property - it may take a while to sell the property - the property may decrease in value |
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things to consider when investing in property |
- location, location, location - close to social locations e.g public transport, schools, shopping centers - land content of the property - fees and costs associated with the purchase - loan costs |
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risk vs reward |
A financial analysis comparing the potential
gains from a project or property against the potential losses. The greater the risk, the greater the reward should be. |
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diversificaton |
A risk management technique that mixes a wide variety of investments within a portfolio.
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supp |
regular payment made into a fund by an employee towards a future pension
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