The Stock Market

1
The Stock Market

• Mrs. Cheney

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What is the Stock Market?

• Not a place an action or activity
• NYSE An actual location
• AMEX computer driven
• NASDAQ computer driven
• Stockbrokers who act for the buyers and sellers
  meet or act online
• Price is determined by the supply and demand of
  the stock

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What is stock?

• Opportunity for companies to raise money without
  selling a product
• Money is used to expand the company
• Small piece of ownership of a company
• Hundreds to thousands of shares are available for
  corporations

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What is a corporation?

• Formal, legal business licensed by the state
• Owners hold the majority (51) or more of the
  shares of the company in order to own the company
• Other shares are sold to make money for the
  company to expand the business
• The shares are sold to investors

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Investors

• Investors buy and sell stocks through a
  stockbroker
• Stockbrokers are paid a percentage of the
  earnings when stock is sold
• People who invest in companies can make profit in
  two ways
• Dividends
• Growth

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Making money in the stock market

• Dividends
• Money paid directly to the investor when the
  stock makes the company money

• Growth
• Stocks increase in worth is given to the
  investor or reinvested when the stock is sold

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Of course, you can also lose money in the stock
market!

• No dividend
• Company goes under
• All money lost!

• Negative movement of stock
• Stock worth goes down
• Sell for a loss

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Why do stock prices change?

• Goes up when
• Company is making money
• Company has a anticipated product coming out
• Company has a merger planned
• Some positive news!
• Goes down when
• Company is losing money
• Company has a lawsuit against it
• Some negative news!

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Bullish and bearish investors

• Bears are cautious
• Do not move fast or a lot
• Buy stock cautiously
• Expect the market to go down
• Bulls are bold
• Move fast and a lot
• Buy stock rapidly
• Expect the market to go up
• WHICH TYPE OF INVESTOR ARE YOU???

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ASSIGNMENT

• Explain what kind of investor you are and why.
• Describe the action of one of your stocks in the
  past week. Has it appreciated or depreciated?
  Why do experts feel it is behaving as it is? Why
  do you feel it is behaving as it is?
• 2 paragraphs total, with citation(s). Paragraphs
  must be at least 5 sentences. Due Wednesday.