Vocabulary

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Equity

/ek-wi-tee/

"Ownership."

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Dividend

/div-i-dend/

"Profit share."

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Diversify

/di-vur-suh-fy/

"Spread risk."

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Volatility

/vol-uh-til-i-tee/

"Price swings."

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Capital

/kap-i-tal/

"Money to start."

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Portfolio

/port-foh-lee-oh/

"Collection of assets."

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Speculation

/spek-yuh-lay-shun/

"Gambling on price."

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Index

/in-deks/

"Market measure."

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Liquidity

/li-kwid-i-tee/

"Cash readiness."

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Yield

/yeeld/

"Return %."

Article

Owning a Piece of the Pie 🥧

A Stock (or Share) represents ownership in a company. Companies issue stocks (IPO) to raise capital to grow.

Bull Market: Prices rising, optimism high. 🐂
Bear Market: Prices falling, pessimism high. 🐻
Dividend: A share of profits paid to owners.
Volatility: How wildly prices swing.

Investors try to 'Diversify' (don't put all eggs in one basket) by buying ETFs (baskets of stocks like the S&P 500) rather than picking single risky companies. 'Market Cap' is the total value of a company (Stock Price x Number of Shares).

Practice

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1.

Bull market means...

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Bear market means...

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Dividend is...

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Diversification helps...

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IPO stands for...

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Market Cap is...

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Liquidity allows you to...

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ETF is...

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Yield usually refers to...

10.