Stock Market
Introduction to the
Stock Market
What is a stock?
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Partial ownership in a business
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Dividends = Profits paid out to stock holders four times a year or
re-invested into the company
Types of Stocks
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Common Stocks – people owning stock can vote for the directors
of the company
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Preferred Stock – fixed dividends, no voting privileges
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Example: NW Natural Gas, GM
Example: Nike, McDonalds
Other words used for stocks
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Equities
Securities
Shares
What is the difference between a
mutual fund and a stock?
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Mutual fund
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Investment through a broker into a fund that has
multiple stocks in many companies
Benefits:

Lower risk because you are diversifying your
investment
Major Stock Markets

New York Stock Exchange (NYSE)
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Wall Street
National Association of Securities Dealers
Automated Quotations (NASDAQ)
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Mostly technology stocks
Automated
How do I purchase stock?

Brokerage House
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Full Service Brokers
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Dean Witter, Merrill Lynch, Prudential Bach
Discount Brokers
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Charles Schwab, Ameritrade, eTrade
Reading Stock Pages
http://finance.yahoo.com/q?s=NKE
Major Stock Markets

New York Stock Exchange (NYSE)
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Wall Street
Major Stock Markets

NASDAQ
–
–
National Association of Securities Dealers
Automated Quotations
Mostly Technology Stocks
General Terms
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Earnings per share: Amt of profit each
share is entitled
Going Public: Company plans to sell stock
Share: investor’s ownership of the profits,
losses, and assets of a company
Market Indices: tracks performance of
specific group or market of stocks
Market Indices


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Dow Jones: index of 30 “Blue Chip” US
stocks of industrial companies (financial,
computer, retail companies)
NYSE: New York Stock Exchange tracks the
movements of all common stocks
Nasdaq: Tracks performance of 100 of the
largest most actively traded stocks
Dow Jones
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Coca Cola
Home Depot
AT&T
American Express
Bank of America
Dupont
GE
Nasdaq Stocks
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Amazon.com
Apple
Costco
Comcast
Google
Dell