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Stock Market. 14 year old investor. What are Some of Your Favorite Companies?. What is a stock?. A stock is a share in the ownership of a company. Stock represents a claim on the company’s assets and earnings.
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What is a stock? • A stock is a share in the ownership of a company. Stock represents a claim on the company’s assets and earnings. • As an owner (shareholder), you are entitled to your share of the company’s earnings as well as any voting rights attached to the stock.
What is the Stock Market? • The market in which shares of publicly held companies are issued and traded for money. • It provides companies with access to capital in exchange for giving investors a slice of ownership in the company.
Who Owns these Companies? http://www.nasdaq.com/symbol/ge/institutional-holdings http://www.nasdaq.com/symbol/aapl/institutional-holdings http://www.nasdaq.com/symbol/pep/institutional-holdings
What is the Difference? Publicly Traded Privately Traded • A public company, is a company that has sold a portion of itself to the public • Offers some of its stock to shareholders , on the stock market • Shareholders have claim to part of the company's assets and profits • The company is owned by the company's founders, management or a group of private investors • Privately held companies do not have stock traded on the stock market
Ticker Symbols • An arrangement of characters (usually letters) representing a particular security listed on an exchange or otherwise traded publicly • AAPL – Apple Inc. • MSFT – Microsoft • PEP – Pepsi Co. • GOOG – Google Inc.
Parent Companies http://www.huffingtonpost.com/2012/04/27/consumer-brands-owned-ten-companies-graphic_n_1458812.html
Parent Companies • So looking at the above chart. • Pepsi is the parent company of Lays • P&G is the parent company of Lams This is important to know when researching stocks. If you are interested in a company and cant find it on Yahoo finance or Hoovers then you should look up the parent company.
PE Ratio A valuation ratio of a company's current share price compared to its per-share earnings. Calculated as: Market Value per Share / Earnings per Share (EPS) For example, if a company is currently trading at $43 a share and earnings over the last 12 months were $1.95 per share, the P/E ratio for the stock would be 22.05 ($43/$1.95).
52 week high/low • The highest and lowest prices that a stock has traded at during the previous year. Many traders and investors view the 52-week high or low as an important factor in determining a stock's current value and predicting future price movement.