10 Investing Terms You Should Know
When you plan to venture in the field of investments, be sure you are knowledgeable about the field before you push your green button. Investing for beginners may be difficult especially when you are left groping in the dark with no available aces close to your chest.
To aid you in your venture, here are some terms that you must understand by heart:
- Ask – is the lowest price a seller is willing to accept in doing stock transactions.
- Bear – an investor who foresees the decline of the market or stock.
- Bid – is the highest price involving a security that a purchaser is willing to accept.
- Blue Chip – a company that has established a long history of solid earnings, regular and rising dividends, and a faultless balance sheet.
- Book Value – is the value of the company after all liabilities are subtracted from assets and common stock equity.
- Dow Jones Industrial Average (DJIA) – is the most famous and widely used gauge of the U.S. Stock Market. DJIA is consists of price-weighted list of 30 highly-traded Blue Chip companies.
- Market Capitalization – a company’s market capitalization, otherwise called as “market cap,” is computed by taking the number of outstanding shares of stock multiplied by the current price-per-share.
- NASDAQ – a stock exchange where shares of technology companies like Cisco and Microsoft are traded. An exchange is a place where options, futures, and shares (including bonds, stocks, indexes, and commodities) are traded.
- Spread – is the difference between the Ask and the Bid.
- Yield – when a company pays a dividend the yield is the percentage of the stock price in connection to the dividend paid.
