A few notes that I wrote down from lesson one and two of the investment lesson. Will be useful for further reference.
- IPO: Initial Public Offering
- Market Cap: short for market capitalization. The amount of money you would have to pay if you bought ever share of stock in a company.
Market Cap = price per share * number of share - Ticker Symbol: eg. Coca Cola =KO
- Book value: the value of the land, building, inventory asset ect. subtracted by the company’s debt. (*important when looking at a company)
- Equity: ownership
- P/E Ratio: market cap / earning
Break…… cup of tea, sushi etc.
- Dividend Yield = annual dividend per share / stock’s price per share
- Bear Market: Slang for when the stock market is in a general prolonged period of falling stock prices. Opposite of a bull market. (Chinese: 熊市 | Japanese: 下がり［売り］相場, 弱気市場. cool name)
- Broker: A person who buys or sells an investment for you (stock, bonds, commoditie etc.) in exchange for a fee, called a “commission”.
- Bull market: opposite to Bear Market, prolonged period of rising stock price. (Chinese: 牛市 | Japanese: 強気市場)
- Dividend: A dividend is a portion of a company’s earning that is paid out to shareholders on a quarterly or annual basis. Most dividend policies are set by current management.
- Index: An index is a benchmark which is used as a reference marker to which financial performance is measured and compared against. “Don Jones Industrial Average” and “Standard & Poor’s 500″ are examples.
- Margin: A margin account let a person borrow money from a broker to purchase securities. The difference between the amount of loan, and the price of securities, is called margin.
- Volatility: companies sell their stock higher or lower than its real value and therefore create fluctuations (volatility).
Continue to learn lesson three today! Need to keep learning, otherwise things will go out from my mind quicker than I can handle.
