https://www.youtube.com/watch?v=X4GZfvXx9Js
Category: Investments
Private Vs. Public
Private and Public are two major terms used in the stock market. A public company is one that sells stocks. You can buy stocks from any public company. Some public companies include Apple and Pepsi. Private companies do not sell stocks, companies do have the choice wether to sell stocks or not. You cannot buy stocks from a private company. Subway is a private company, therefore it doesn’t sell stocks.
Thats all for now, Ben
Stock Splits
A stock split is when a company decides to “split” it’s stocks. The value of all stocks is split in half to allow people to invest in the company with less money. Don’t worry though, if you held stock in a company that announced a stock split the amount of stocks you own would double. A stock split is always great if you don’t have much money to invest with.
That’s all for now, Ben
Blue Chip Stocks
Blue chip stocks are stocks in strong, industry leading businesses. These companies are fairly stable and always growing. The name is thought to be derived from gambling, where the blue chips are the highest value of chips used in a casino. The stocks for blue chip companies can be expensive, but they almost always go up in price overtime. Some blue chip companies include Apple, Google, Coca-Cola, and Starbucks.
That’s all for now, Ben
Dividends?!
Dividends are money given to shareholders by a company they’ve invested in. It’s a useful way for companies to get more people to buy shares. Not all companies offer dividends, and even when they do it’s only a few cents per month. Don’t ever use a dividend as a reason to purchase a stock, instead consider other factors that make the company great. They are just an added bonus to some great stocks and some not so great ones.
Thats all for now, Ben
Bears & Bulls
Why do I keep hearing about bears and bulls? These are terms to descrbe how the stock market is doing. A bull market means that the market is trading up on average. The opposite is a bear market. This means that the market is trading down on average. You always want to invest in a bull market, otherwise you lose money. Nobody knows where the term came from, but some think its because a bull raises its head when its about to charge and a bear lowers it’s head when it’s about to charge.
That’s all for now, Ben
Stock Brokers
Stock brokers are the people that help you trade stocks. They can be real life people or online programs. Basically they do their best to make sure that your order is filled. If you were to request 50 shares in Apple inc, the stock broker would look for the best deal they could find and then finish the transaction. Personally, I prefer online stock brokers. They are cheaper and quicker to use, although they can’t offer good advice like real stock brokers can.
Thats all for now, Ben
Trading Time
Trading in the stock market follows rules. One of these rules is the hours that the market is open. People can only buy stocks from 9:30 AM to 4:00 PM. After that, the market closes and no one can trade until the following day. Someone also can’t trade on weekends or holidays. The market is closed on these days. Click Here to see the holidays that you can’t trade on.
Thats all for now, Ben
What is a Ticker Symbol?
A ticker symbol is a combination of letters that any public company can be recognized by. If you were to go to any investment website and enter the ticker symbol you would quickly find all the information about that companies stock. Some famous ticker symbols include AAPL (Apple), MSFT (Microsoft), FB (Facebook), SBUX (Starbucks), and KO (Coca-Cola). Ticker symbols are useful for quickly checking the information on companies.
That’s all for now, Ben
Who is Dow Jones? What is the Nasdaq?
The Dow Jones Industrial Average Index, the Nasdaq, the S&P 500 Index and many others are called indices. They are ways of tracking how the economy and overall stock market is doing. Each of them measures this in a different way. The Dow Jones Index tracks 30 strong companies to reflect the overall market and was the first index ever created. The Nasdaq tracks all of the companies that trade on it, and the S&P 500 tracks, you guessed it, 500 companies that seem to be doing very well. Basically if an index is going up then you could guess that most stocks are going up as well. Check out the current Dow Jones price. It’s very interesting to see how it changes over time.
Check out the Dow Jones price Here.
If you look all the way back to 1929 you’ll see that the Dow Jones was at about $300 and quickly rising. Now if you look at 1932 you’ll see that it was at about $50. That means if you had invested in a company in 1929 it likely would’ve fallen very quickly throughout the 1930s. This was because of the great depression, an event that caused millions to lose their jobs and resulted in over 23% of the world population being unemployed. People couldn’t afford to buy stocks in companies, and as the demand goes down so does the price. This is a good example of how real life events can affect the stock market, but don’t worry, these events aren’t always negative. Say a company named fuzzy wool socks inc. (A non-existent company) is experiencing incredible sales. The world wants wool socks! As a result the fuzzy wool stock price goes up a ton thus affecting the price of some indices and benefiting the economy. Remember that although the price of indices goes up and down you actually can’t invest in indices. They are simply a way of tracking how the economy is doing.
Overall, indices are a great way of estimating how the world economy is doing and how much the average stock is going up or down.
See you later, Ben
P.S. If you would like to check out some other indices click on their links below.
Mr. Moose 