The Stock Market
United States History
Ms. Girbal
Friday, February 6, 2015
Warm-up (2-6-15)
 Take out the ads had to bring for homework (an ad from the
1920s and an ad from today)- we will now compare and contrast
them (find similarities and differences). Write ONE paragraph in
COMPLETE sentences.
 Look for the following:
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Black and white? Color?
Is there text? Only images?
Any slogans? Any images?
What audience are your ads targeting?
What story are your ads telling?
 Make sure to answer the following:
 Do you think that ads have evolved from the 1920s to today? If so,
how? If not, then what elements are still prevalent?
The Stock Market
 A stock market is where shares in corporations are issued
and traded. Stock markets are key components of a free
market economy.
 Stock markets serve two main functions.
 Company perspective- provide access to capital, usually in the
form of cash. If a company needs to finance a major project,
it can sell its shares in the stock market to raise capital,
instead of borrowing the money from a bank.
 Shareholder perspective- provides a way to participate in a
company’s growth, and also quickly convert shares into cash.
This happens in two main ways.
The Stock Market
 When you own a share of stock, you are a part owner in
the company with a claim (however small it may be) on
every asset and every penny in earnings.
 As a company's earnings improve, investors are willing to
pay more for the stock.
 The whole idea behind the stock market is for people to
INVEST money into companies, so these companies have
money to keep bringing in goods into the economy.
Companies sell stock to get money to
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Research better ways to make things
Create new products
Improve the products they have
Hire more employees
Enlarge or modernize their buildings
The Bell!
 A bell that is rung to signify the start of the day's trading session.
The opening bell is both a symbol of the opening of the market for
the day and a physical event involving an individual striking a metal
bell.
 Since 1985, the New York Stock Exchange (NYSE) has used the
opening bell to start its trading session at 9:30 a.m. (NY time)
 They also use it to close the day- the end of the trading session at
1PM (NY time)
 Dignitaries visiting stock markets take part in small ceremonies in
which they ring the opening bell. Not all exchanges use this
traditional system, with the NYSE remaining one of the more
recognizable exchanges that still uses a bell.
Terms to help us…
 Bear Market: This is trading talk for the stock market being in
a down trend, or a period of falling stock prices. This is the
opposite of a bull market.
 Bull Market: This is when the stock market as a whole is in a
prolonged period of increasing stock prices. Opposite of a
bear market.
 Broker: A person who buys or sells an investment for you in
exchange for a fee (a commission).
 Buying on Margin: person can borrow money (take out a
loan essentially) from a broker to purchase an investment.
 Exchange: An exchange is a place in which different
investments are traded. The most well-known in the United
States are the New York Stock Exchange and the Nasdaq.
More terms…
 Dividend: this is a portion of a company’s earnings that is paid to
shareholders, or people that own hat company’s stock, on a quarterly or
annual basis. Not all company’s do this.
 Blue Chip Stocks: These are the large, industry leading companies. They offer
a stable record of significant dividend payments and have a reputation of
sound fiscal management. The expression is thought to have been derived
from blue gambling chips, which is the highest denomination of chips used in
casinos.
 Portfolio: A collection of investments owned by an investor. You can have as
little as one stock in a portfolio to an infinite amount of stocks.
 Sector: A group of stocks that are in the same business. An example would
be the “Technology” sector including companies like Apple and Microsoft.
 Stock Symbol: A one-character to three-character, alphabetic root symbol,
which represents a publically traded company on a stock exchange. Apple’s
stock symbol is AAPL.
How to read stock data…
 Current – The current price of the stock, this will be the price the
transaction occurs at.
 Open – This is the price that the stock last opened at. This gives you an idea
of how much the stock has moved since the last trading day opened.
 High – This is the highest value the stock has reached in the last trading
day.
 Low – This is the lowest value the stock has reached in the last trading day.
 Volume – The amount of shares that have been traded in the last trading
day. This is helpful to understand if there has been lots of activity on this
stock which might indicate that investors think it’s good or bad.
 Change – The percentage change from it’s opening value to the current
value.
 Charts: The top chart is the last year, the bottom chart is the last trading
day. Helpful to view trends.
Do your research first!
 Before you buy stocks, you have to do a little research on the
companies you're thinking of investing in.
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Record of sales
Earnings from pervious years
Dividends paid
Prospects for the future (growth)
 Can’t predict the future for sure, but we can look and make predictions
Stock Market Game Time!
https://studentstocktrader.com
Ms. Girbal’s Period 5
16675-0
mariners
Ms. Girbal’s Period 6
16682-0
mariners
Rules of the Game (Updated)
 You must invest money (buy shares!)- the starting $50,000
cannot stay in your “cash” account.
 You can ONLY keep around 5,000 in the “cash” at a time- the
rest has to be invested in stocks
 You must invest in at least 5 different companies
 You must have movement in your accounts at least 2 times a
week
 You need to buy or sell
 I will be checking your profiles to make sure these things are
happening- this is for a grade!
 We will be playing for one month
 The top 5 winners will get extra credit
How to pick stocks…
 Create a list of the products or websites you usually use or visit.
 Look for things they have at home like cleaning products, dish
soap, bath soap, laundry detergent, food items in the
refrigerator or cupboard
 In addition to the product name, look look into the company
that makes the product, from here they can explore where the
product was bought, who makes the product, and possibly
other products the company produces.
 Make sure you do your research on the company you are going
to invest YOUR money into.
Homework (2-6-15)
 Make sure that
your account is
set-up
 Do your research
and buy some
stocks!