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The Stock Market Continued

The Stock Market Continued. Personal Finance Mrs. Brewer. The Stock Market Game. www.smgww.org. INVESTMENT OBJECTIVES. Buy and Hold Buy and Sell Rapidly Time Frame Diversify. Stocks. Large Cap – Greater than 10.9 Billion Blue Chip Stocks Higher Price Best Price Stability

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The Stock Market Continued

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  1. The Stock Market Continued Personal Finance Mrs. Brewer

  2. The Stock Market Game www.smgww.org

  3. INVESTMENT OBJECTIVES • Buy and Hold • Buy and Sell Rapidly • Time Frame • Diversify

  4. Stocks • Large Cap – Greater than 10.9 Billion Blue Chip Stocks Higher Price Best Price Stability Least Risk Minimal Growth Potential

  5. Stocks • Mid Cap – Greater than 2.3 Billion Baby Blue Chips Greater Growth Potential • Small Cap – Less than 2.3 Billion Growth and Tech Stocks Potential Big Gains High Risk

  6. Types of Stocks COMMON STOCK PREFERRED STOCK Shares sold to investors Guaranteed Fixed Dividends (paid before common stock dividends) No Voting Rights • Shares sold to investors • Gives Voting Rights • May pay Dividends

  7. Types of Stocks INCOME STOCKS GROWTH STOCKS Fast Growing No Dividends Potential for High Growth Riskier Ebay, Starbucks • Pay High Dividends • Price of Stock does not rise quickly • Utility Companies • Transportation Companies

  8. Types of Stocks CYCLICAL STOCKS DEFENSIVE STOCKS Resilient to economic cycles Wal-mart Auto Repair Shops Food Stores • Price goes up and down with economy • Alcoa • Caterpillar

  9. Bonds • Basically an IOU • Promissory Note to Pay • Specific Maturity Date • Short Term 1-5 Years • Long Term 30-40 Years • Issued in multiples of $1,000 or $5,000 • Annual or Semiannual Interest Payments

  10. Types of Bonds • Corporate Bonds • Municipal Bonds • Government Bonds • Issued by Corporations to raise money • Public entity that issues bonds • Treasury Notes • Savings Bonds

  11. Mutual Funds • A mutual fund is a company that brings together money from many people and invests it in stocks, bonds or other assets. • 401(K) Plans

  12. HOW TO INVEST http://www.xtranormal.com/watch/11329510/ Listen for these terms: Online Brokerage Full Service Brokerage Financial Planners/Advisor Direct Purchase Plan

  13. Investment Options • Online Brokerage • www.eoption.com • Full Service Brokerages • www.rateitall.com • Financial Advisors & Planners • Direct Purchase Plan • www.stock1.com/stockc.htm • DRIP

  14. Stock Tables

  15. How to Read Stock Tables • http://ttc.seal-pa.org/SafeVideos/Video.aspx?id=nW93AyN8u5A

  16. Stock Market Calculations PPL Dividend $1.40 on 150 Shares. How much did we earn? WalMart Buy 200 shares at 51.75. Sell them at 52.07. How much was your profit? McDonald’s closing stock price? Up or Down? How much?

  17. The Rule of 72 • How long will it take to DOUBLE my $$? • 72 divided by Interest Rate = # Years • 72/3%= 24 years

  18. The Rule of 72 • At what Interest Rate will my $$ Double? • 72 divided by Years to Double = Interest Rate • 72/10 years = 7.2%

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