The 10 Terms You Need To Know Archives - HowTheMarketWorks

Bond

Phil Simard — Mon, 24 Aug 2015 08:08:12 +0000

Promissory notes issued by a corporation or government to its lenders, usually with a specified amount of interest for a specified length of time. This is seen as a loan from the bond holder to the corporation. The value of Bonds traded are greater than the value of stocks traded.

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Stock

Kevin Smith — Fri, 21 Aug 2015 12:46:13 +0000

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Asset

Phil Simard — Tue, 18 Aug 2015 15:43:31 +0000

Definition: An asset is anything that has monetary value and can be sold. Assets can be anything from a pencil (though it is not worth much) to a skyscraper to things like Stocks and ETFs. There can also be intangible assets such as the value of a brand name or logo. Details: Assets generally refer Read More...

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S&P 500

HTMW Team — Sun, 26 Jul 2015 13:29:18 +0000

The S&P 500, or the Standard & Poor's 500, is a stock market index based on the common stock prices of 500 top publicly traded American companies, as determined by S&P. It differs from other stock market indices like the Dow Jones Industrial Average and the Nasdaq Composite because it tracks a different number of stocks and weights the stocks differently. It is one of the most commonly followed indices and many consider it the best representation of the market and a bellwether for the U.S. economy.

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Various Risks of Investing

HTMW Team — Mon, 25 Mar 2013 20:46:07 +0000

Your ideal investment or investment portfolio gives you the most opportunity for the risk you can bear. In this sense, it is important to understand the risk inherent in an investment before you look for the opportunity.

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Compound Interest

Phil Simard — Mon, 15 Oct 2012 19:02:57 +0000

Had the American Indians sold their beads and trinkets they received from selling Manhattan Island, invested their $16 and received 8% compounded annual interest, not only would they have enough money to buy back all of Manhattan, they would still have several hundred million dollars left over. That is the power of compound interest over time.

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Mutual Funds

HTMW Team — Sat, 06 Oct 2012 17:35:24 +0000

A mutual fund is a form of professionally executed investment tool that merges money from numerous investors to buy securities.

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Exchange Traded Fund (ETF)

HTMW Team — Fri, 05 Oct 2012 12:44:46 +0000

A stock like security that follows an index, a commodity or a basket of assets like an indexed mutual fund. Securities like ETFs trades like a stock. ETFs prices change throughout the day, like a stock, as they are bought and sold.

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What is a Balance Sheet?

HTMW Team — Tue, 25 Sep 2012 02:33:38 +0000

A summary of the financial balances of a sole proprietorship, a business partnership, a corporation or other business organization, such as an LLC or an LLP. Assets, liabilities and ownership equity are listed as of a specific date, such as the end of its financial year.

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P/E Ratios

HTMW Team — Mon, 24 Sep 2012 21:43:23 +0000

The price to earnings ratio is a useful tool but certainly not the holy grail of investing as it is sometimes made out to be.

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