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Basics Financial Definitions
We breakdown the basic concepts and definitions of Financial Terms into verbiage the lay man can consume.
Basic Types of Investments
Stocks
Stocks
The Stock Market is where people buy and sell Securities at a price agreed upon. Usually using a Broker
Bonds
Stocks
A Bond is a debt security. Basically a IOU. Borrowers issue bonds to raise money from investors who lend them money for a certain amount of time.
Mutual Funds
Type of Investment Company the pools money from from many investors, & invest the money in securities.. Then you buy shares of the Company/Fund.
Exchanged-Traded Funds (ETF's)
Real Estate Investment Trusts (REITs)
Like Mutual Funds, ETFs offers a way to pool resources in a fund that makes investments in securities, in return, to receive an stake in the investment pool. But ETFs are traded on a national stock exchange.
Real Estate Investment Trusts (REITs)
Real Estate Investment Trusts (REITs)
Real Estate Investment Trusts (REITs)
Allow you to invest in large scale, real estate. Owns and Operates income producing real estate, but doesn't typically develop real estate to resell.
Commodities
Real Estate Investment Trusts (REITs)
Real Estate Investment Trusts (REITs)
Commodities are raw materials that are either Consumed directly, like food, or as building blocks to create other products. Metals, grains, and other food, as well as financial instruments, and currencies (US & Foreign), are traded commodities.
Basic Terms and Concepts
Detail your services
ASSETS
Anything that puts money in your pocket.
BONDS
A bond is like a loan. When you buy a bond, you are usually agreeing to lend money to a government or a company. Typically, the bond issuer promises to repay the loan amount on a future day, and pay interest income in the meantime based upon a coupon rate.
BULL MARKET
When most stock prices are rising over several months.
BEAR MARKET
When most stock prices are falling our several months.
COMMODITY
A raw material or primary agricultural product that can be bought and sold, such as gold, copper or coffee; a useful or valuable thing, such as water or time.
BROKER
A person that buys or sells an investment for you in exchange for a fee called commission.
DIVIDENDS
A portion of a company’s profits that is paid out to shareholders on a quarterly or annual basis.
DOW JONES INDUSTRIAL AVERAGE (DJIA)
It is the most popular and widely used measure of the U.S. Stock Market. It consists of a price-weighted list of 30 highly-traded Blue Chip companies. The Dow is watched by investors as an indicator of the health and direction of the stock market.
EQUITY
Put simply, equity is ownership. In the trading world, equity refers to stock. In the accounting and corporate lending world, equity (or more commonly, shareholders' equity) refers to the amount of capital contributed by the owners or the difference between a company's total assets and its total liabilities. (Mail Box Money)
LIABILITIES
Anything that takes money out your pocket.
MUTUAL FUND
An investment company that combines the money from a large group of investors to buy stocks and other investments.
P/E RATIO
How much money you are paying for $1 of the company’s earnings. In other words, if a company reports a profit of $3 per share, and the stock is selling for $30 per share, the P/E ratio is 10 because you are paying ten-times earnings ($30 per share divided by $3 per share earnings = 10 P/E).
SECURITIES
Includes stocks, bonds, and bank deposits.
STOCK/ EQUITIES
A type of Security. If you own a stock, you own part of the company.
S.E.C
Security and Exchange Commission (Financial Police)
Disclaimer
The KORPORATION has provided this information as a service to investors and possible investors. It is neither a legal interpretation nor a statement of the KORPORATION policy. If you have any questions concerning the meaning or application of a particular law, rule, or definition please consult with a attorney who specializes in Securities Law.
