stock market

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1948 - Dick and Mac McDonald open the first McDonald’s drive-thru restaurant in
San Bernardino, California.
1955 - Total sales for the company are $193,772.
1961 - Ray Kroc buys out the McDonald brothers for $2.7 million.
1964 - The company’s gross sales hit $130 million
1965 - McDonald’s celebrates its 10th anniversary with the first public stock offering
at $22.50 per share.
2000 - Systemwide sales exceed $40 billion
2007 – February 20, you can buy 1 share of McDonalds for $45.80
1,240,000,000 Shares Outstanding
How much money would
you earn a year from a
$100 investment in a
savings account?
YIELD also called
RETURN
The profit or income
produced by a financial
investment, usually
shown as a percentage
If you invest $400 and you make a profit of $20,
what is your yield percentage?
20/400 = 5%
SHARE
One of the parts into which the
ownership of a corporation or a mutual
fund is divided.
STOCK
Stock represents a claim on the
company's assets and earnings.
STOCK MARKET
A stock market is a market for the trading of publicly
held company stock and associated financial
instruments.
DIVIDEND
A payment to the stockholders of a corporation from
the company’s earnings.
Stock Exchanges
Places where the
stocks and bonds of
member companies
are traded.
AMERICAN STOCK EXCHANGE
(AMEX)
The nation's second largest floor-based
exchange
The Pacific Exchange (PCX) is
the third largest stock options
exchange in the world.
NASDAQ
National
Association of
Securities Dealers
Automated
Quotation
•Trades most active stocks listed on NYSE & AMEX as
well as young small companies
•Dealers Automated Quotation
•Started in 1971
•Worlds first electronic stock market
•No specialists — linked by computer network
New York Stock Exchange
(NYSE): The world’s largest and leading marketplace for
securities. It lists stock of the oldest, largest, and best-known
companies.
Penny Stock
A stock that sells for less than
$1 a share but may also rise to
as much as $10/share as a
result of heavy promotion.
Penny stocks are highly
speculative and risky. Many
brokerages don't cover them
simply because they are so
difficult to track and predict.
Blue Chip:
A term used to describe stocks
of high-quality, financially
sound corporations.
These stocks are usually less risky
than other stocks.
Wall Street - The main street in New York
City's financial district. The term is often used to mean the
entire financial district in New York or the world of U.S.
finance and investments.
Broker:
One that acts as an agent between a
buyer and seller who charges a
commission for the service.
(PaineWebber, Merrill Lynch)
Commission:
A fee paid to a broker for buying or
selling securities.
•Full service broker - 2-3%
(smaller on larger trades)
•Discount broker - $5.25 a trade
(E-Trade, Charles Schwab)
Principal:
The amount of your own money
you put into an investment.
If you buy 10 shares of McDonalds for $30 a share,
how much have you invested?
$300
If you sell your 10 shares a year later for $40 a
share, how much money have you made?
$400 – 300 = $100
What is your principal?
$300
PORTFOLIO
The stocks and other investments owned by an individual or institution.
Microsoft
Warner
Bros.
McDonalds
General
Electric
Diversification - Reducing investment risk by spreading
your money among different classes of
investments.
Bear Market: A market that is
going down. This expression
comes from the way that a
bear attacks, by swinging its
paw downward.
BEAR
Bull
A market that is going up. This
expression comes from the way that
a bull attacks, by lowering its head
and then bringing its horns up.
What makes stocks go up and down?
1 Year (daily)
• How much people are willing to pay
• How cheaply owners are willing to sell
INDEX
A statistical measure of change in a securities market.
Indexes are useful tools for tracking market trends.
1. Dow Jones - The Dow Jones Industrial Average is a priceweighted average of 30 significant stocks traded on the New
York Stock Exchange and the Nasdaq.
2. S & P 500 - The S&P 500 is one of the most commonly
used benchmarks of the overall stock market.
3. NASDAQ Composite - The Nasdaq Composite Index
represents all the stocks that trade on the Nasdaq stock
market.
Securities and Exchange
Commission
The federal agency that regulates stock
transactions.
The
End
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