Flashcards
Key Terms Chapter 21: Stocks
Cards in this deck (21)
- 1Bond yieldTotal annual interest divided by total cost.
- 2BondsBond selling for more than the face value.
- 3Common stockUnits of ownership called shares.
- 4Cumulative preferred stockHolders of preferred stock must receive current year’s dividends and any dividends in arrears before any dividends are paid out to the holders of common stock.
- 5DiscountAmount bond sells below $1,000.
- 6DividendsDistribution of company’s profit in cash or stock to owners of stock.
- 7Dividends in arrearsDividends that accumulate when a company fails to pay cumulative dividends to preferred stockholders.
- 8Earnings per share (EPS)Annual earnings divided by total number of shares outstanding.
- 9Mutual fundInvestors buy shares in the fund’s portfolio (group of stocks and/or bonds).
- 10Net asset value (NAV)The dollar value of one mutual fund share; calculated by subtracting current liabilities from current market value of fund’s investments and dividing this by number of shares outstanding.
- 11Odd lotsLess than 100 shares.
- 12PE ratioClosing price per share of stock divided by earnings per share.
- 13Preferred stockType of stock that has a preference regarding a corporation’s profits and assets.
- 14PremiumPeriodic payments that one makes for various kinds of insurance protection.
- 15Price-earnings (PE) ratioClosing price per share of stock divided by earnings per share.
- 16Round lotsMultiple of 100 shares.
- 17Stock certificateEvidence of ownership in a corporation.
- 18Stock yieldDividend per share divided by the closing price per share.
- 19StockbrokersPeople who with their representatives do the trading on the floor of the stock exchange.
- 20StockholderOne who owns stock in a company.
- 21StocksOwnership shares in the company sold to buyers, who receive stock certificates.