investment vocabulary
Terms
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- Investing
- The act of committing money or capital to an endeavor (a business, project, real estate, etc.) with the expectation of obtaining an additional income or profit.
- Balance Sheet
- A financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time.
- Economics
- social science that studies how individuals, governments, firms and nations make choices on allocating scarce resources to satisfy their unlimited wants
- Fund Manager
- The person(s) resposible for implementing a fund's investing strategy and managing its portfolio trading activities.
- Dividend
- A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders
- Stock Market
- The market in which shares are issued and traded either through exchanges or over-the-counter markets
- Bond
- A debt investment in which an investor loans money to an entity (corporate or governmental) that borrows the funds for a defined period of time at a fixed interest rate
- Mutual Fund
- An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets.
- Capital Appreciation
- A rise in the value of an asset based on a rise in market price
- Registered Retirement Savings Plan.
- are the Canadian government's way of helping citizens save their money for retirement.
- Bear Market
- A market condition in which the prices of securities are falling or are expected to fall
- Risk-Free Asset
- An asset which has a certain future return
- Analyst
- A financial professional who has expertise in evaluating investments and puts together "buy", "sell" and "hold" recommendations for securities.
- Stock
- A type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings.
- Prospectus
- A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details about an investment offering for sale to the public
- Peter Lynch
- managed the Fidelity Magellan Fund from 1977 to 1990, during which time the fund's assets grew from $20 million to $14 billion
- Growth Investing
- strategy whereby an investor seeks out stocks with what they deem good growth potential
- Pension Plan
- type of retirement plan, usually tax exempt, wherein an employer makes contributions toward a pool of funds set aside for an employee's future benefit.
- Growth Stock
- Shares in a company whose earnings are expected to grow at an above-average rate relative to the market.
- Principal
- 1. The amount borrowed or the amount still owed on a loan, separate from interest.
- Capital
- 1. Financial assets or the financial value of assets, such as cash.
- Income Statement
- A financial statement that measures a company's financial performance over a specific accounting period
- Risk
- The chance that an investment's actual return will be different than expected
- Value Investing
- The strategy of selecting stocks that trade for less than their intrinsic values
- Fixed-Income Security
- An investment that provides a return in the form of fixed periodic payments and the eventual return of principal at maturity
- Compounding
- The ability of an asset to generate earnings, which are then reinvested in order to generate their own earnings
- Speculation
- The process of selecting investments with higher risk in order to profit from an anticipated price movement
- Interest
- 1. The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.
- Risk Tolerance
- The degree of uncertainty that an investor can handle in regard to a negative change in the value of his or her portfolio.
- Volatility
- A statistical measure of the dispersion of returns for a given security or market index.