Bonds: issued by businesses and government units with a fixed schedule for future payments to the purchaser of the bond
U.S. Savings bonds: issued by the U.S. government so they’re typically long-term, low-risk investments
Dividend: money paid from a company to its shareholders (typically quarterly)
Shareholders: people who buy stock/own shares of a company
Stakeholders: anyone who is affected by a company’s decisions and would, therefore, develop an interest in the company
Initial Public Offering (IPO): the company’s stock price when it first switches from private to public
Stock: piece of a company; companies raise funds by selling parts (at their stock price) of their companies to consumers
Shorting a stock: betting that the stock’s price will decrease
Stocks can be bought and shorted on different exchanges, with the most commons ones being the NASDAQ and the NYSE (New York Stock Exchange)
Mutual Fund: a group of stocks, bonds, commodities, etc. that offers the investor diversification (a variety), making it less risky than investing in a single stock
401(k): associated with your work employer, your employer will add money to your retirement portfolio depending on how much money you contribute from your salary
Individual Retirement Account (IRA): a specified, tax-deductible limit can be invested with the amount invested not being taxed until it’s withdrawn; cannot withdraw from IRA until 59 ½ years old
Roth IRA: similar to an IRA except you’re invested money is taxed at the time of the investment (not at the time of withdrawal)
Certificate of Deposit (CD): another method of placing money in the bank and receiving interest; the money placed in a CD cannot be withdrawn for a certain period of time
Maturity: the date when a financial instrument (like a bond) ends/stops giving out payments
Want to learn more? Here are some helpful Quizlets:
Sources include: NAIC, OppLoans, HelpWithMyBank
Photo credit: QuoteInspector.com