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investment strategies
vocabulary
33
Finance
11th Grade
05/07/2013

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Term
return
Definition
the income that an investment produces
Term
volatility
Definition
the defree to which an investment's return or value may change
Term
risk
Definition
the possibility of variation in the return on your investment
Term
diversification
Definition
strategy of making a variety of investments in order to reduce your exposure to risk
Term
portfolio
Definition
collection of investments
Term
investment club
Definition
group of people who meet refularly to learn about investing and to make investments together
Term
pension plan
Definition
any retirement plan offered to a company's employees
Term
401 k plan
Definition
type of defined-contribution pension plan to which the employee contributes on a pretax basis
Term
IRA
Definition
personal savings plan that enables workers and their spouses to set aside money for retirement
Term
Roth IRA
Definition
IRA in which contributions are not tax-deductible
Term
Keogh plan
Definition
federally approved, deifined-contribution, tax-deffered retirement pan designed specifically for self employed people.
Term
stock
Definition
ownership interest in the corporation
Term
shares
Definition
individuals units of ownership, available for purchase
Term
shareholders
Definition
investors who purchase shares of stocks
Term
stock markert
Definition
organized trading of stocks
Term
stock exchange
Definition
central location where stocks are sold on a trading floor
Term
divident
Definition
payment to shareholders that represents a portion of the company's net profits
Term
stockbroker
Definition
individual or firm that will buy and sell stock for clients according to their instructions
Term
bonds
Definition
corporations and governments can obtain funds by issuing cerficates of debt
Term
mutual funds
Definition
a group of incestments that is held in common by many individual investors
Term
prospectus
Definition
legal document that provides potential investors with information about a mutual fund or other security
Term
annuity
Definition
contract purchased from an insurance company
Term
real estate
Definition
land and any structures on it
Term
commodities
Definition
basic economic goods bought and sold in quantity
Term
estate
Definition
assets and liabilities left behind by a deceased person
Term
estate planning
Definition
the process of making lefal and financial arrangements for how ones property should be administered before and after death
Term
will
Definition
legal document in which a persons directs how his or her estate is to be distributed after death
Term
executor
Definition
individual who is in charge of handling the affairs of an estate
Term
beneficiary
Definition
person or group designated to receive some or all of a deceased persons assests
Term
intestate
Definition
person who dies without a valid will
Term
living trust
Definition
legal arrangement that can serve as an alternative to a will
Term
power of attorney
Definition
legal document assigning someone the right to act on a persons behalf
Term
living will
Definition
legal document that outlings a persons wishes for medical treatment under specific circumstances
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