CHAPTER 7

INVEST

• to use money to earn interest or income,
• or in the hopes of making a profit;
• for example to buy stocks or bonds

PREFERRED STOCK

• stock that offers the stockholder stated
• dividends but does not give the stockholder
• voting rights

COMMON STOCK

• stock that gives the stockholder voting
• rights but may or may not offer dividends

INVESMENT

• the use of money to earn interest or income,
• or to make a profit

CAPITAL GAIN

• the money earned when you sell something
• for more than you paid for it

CAPITAL LOSS

• the money lost when you sell somethimg
• for less than you paid for it

INTEREST

• a specified amount of money a borrower
• must pay a lender for the use of
• borrowed funds

STOCKBROKER

• a person who is licensed to buy & sell
• stocks & bonds for other people

STOCK MARKET

• a place where stocks & bonds are traded
• (bought & sold)

BOND

• an IOU; the person who buys a bond is lending
• money to the government or corporation that
• sells the bond

CREDITOR

SECURITIES

WHAT 2 WAYS CAN PEOPLE MAKE MONEY ON THE STOCK MARKET?

WHAT ARE 2 DIFFERENT KINDS OF STOCK?

WHAT IS A BOND?

WHAT 2 RESPONSIBILITIES OF THE SECURITIES & EXCHANGE COMMISSION?

• to regulate the trading of securities such as stocks & bonds
• to prevent people with "inside information" from making money
• unfairly on the stock market

WHAT 4 GUIDELINES CAN YOU USE TO INVEST IN STOCKS & BONDS?

• ask friends & other people about stockbrokers
• get a name of a broker trustworthy, think over their advice carefully
• corporation will provide you with info about stocks & bonds (for sale)
• be aware of what is happening in the stock & bond markets