Vocabulary Words List

1. Stocks- a share of a ownership of a compay.
 EX: Stocks are invested into companies to become a partial shareholder of the company itself.
2. Bonds- used to finance a variety of projects and activities.
 EX: My parents bought me a savings bond so that I can get more money by the time it expires.
3. Dow Jones- a mix of the top 30 countries.
 EX: The economy is in a recession, therefore the result is that the Dow Jones is down.
4. Equity- ownership of an asset that is completely paid off.
 EX: The equity of my house is almost paid off, however with all these improvements I decided to sell it due to my remodeling I had done to it.
5. Dividends- money paid to a number of people (usually the shareholders)
 EX: The dividends of the Kellogs cereal, is the money that the compnay is making as extra income.
6.Earnings- the amount of profit that a company produces
 EX: The earnings from the releases of the iPad helped sky rocket the companies business and income.
7. Private Companies vs. Public Companies- private is inaccesible public is open to the public
 EX: Miss Me Jeans are a private company therefore I can not invest in them, where as American Eagle is a public company, which allows me to invest in their stocks.
8. Growth Stock- shares in a company whose earnings are expected to grow above average.
 EX: The company that should have the highest amount of growth stocks is Apple, beacuse of the release of all their new products.
9. Risks- different than expected losing some or all of the original investment.
 EX: It is always a risk investing in the stock market; you never know if you are going to make money or lose money.
10. Small Cap- stocks with a relatively small market capilization
 EX: Small companies are small cap compainies because not as many people are aware of them, and smaller business have a higher risk of not working out.
11. Mid Cap- stocks with an average market capilization.
 EX: Mid Cap companies are companies that have made themselves know, but have not yet guaranteed that they will be making money in high amounts
12. Large Cap- stocks with the highest market capilization
 EX: Many bigger companies are Large Cap companies that have established themselves and have set a good foundation; the people know that these companies will not go belly up so they trust that there is not as high of a risk investing in these companies.
13. Dow Jones- an average price of 30 stocks in the United States
 EX: When the Dow Jones is up, it helps our economy go up as well.
14. S & P 500- 500 large cap stocks that are commonly traded
 EX: Walmart is a part of the S&P 500
15. Russell 2000-index measuring the performance of 2000 smallest companies
 EX: Small cap companies are part of the Russell 2000
16. Treasurery Bond- a bond with a fixed interest issued by the government
 EX: A treasurery bond is paid for all by the government.
17. Inflation- rising and falling of prices
 EX: When the stock market inflates the prices change dramatically.
18. Gross Domestic Product- the money value of all the finished goods and services produced within a countrys borders in a specific time period.
 EX: The countrys gross domestic product went up excessively in the past month.
19.Currency- money
 EX:Without currency we would have no cash to spend.
20. Infrastructre- the basic physical systems of a business or nation
 EX:The infrastructure of a business is all the customers that support it.
21. Economy- the large set of related economic production and consumption activites which aid in determining how resources are used.
 EX: When the economy is effected, the business owners and customers are also effected.
22. Economic Structure- the system of production, consumption, distribution
 EX: The economic structure of our country takes place within Wall Street and then travels to everywhere else.
23.Supply and Demand-higher demand equals higher prices, then the supply increases which means lower prices.
 EX: The supply and demand of Miss Me Jeans is awful because everyone wants them, but there is not enough being made currently.
24. Interest- amount of extra money being charged while you are paying something off
 EX: I have now paid off my loan, but now i need to pay off the interest that the bank charged me for taking out thte loan.
25. Assets- anything you can sell that benefits you
 EX: The asset of a business is the goods that it produces.
26. Accounts payable- short term debt payments
 EX: When I take out a loan, I own thte bank my accounts payable as my way of repayment.
27. Accounts receivable- money owed to you
 EX: When I loan out money to a friend, the money that they owe back to me is my accounts receivable.
 28. Amortize- installment payment
 EX: You can amortize a loan, so that the money equals out better and shows you a better layout.
29. Economic Index- data on a macroeconomic scale used to interpret current or future investments possibilites
 EX: The economic index allows the country to predict the budget for future years.
30. Depreciation- when the value of an object is less over time
 EX: The value of the house depreciated as time went on.
31. Gross Margin- profits divided by net sales
 EX: By saling more than the amount the gross margin will be a little under breaking even.
32. Earning per Share- portion of a companys profit of outstanding share of their common stocks
 EX: The way to make more money is by the businesses is earning per share.