Vocab Flashcards
(18 cards)
Primary Market
Where stocks are created and sold to the public for the first time. Primary market transactions are between the company and investors.
IPO
The first sale of stock by a company to the public; short for Initial Public Offering
Stock Buyback
When a company purchases its own shares on the secondary market
Blue Chips
The most well-established, prestigious corporations
Penny Stocks
Very small, unknown companies whose shares may trade for literal pennies
Secondary Market
Where transactions are between investors
Large-Cap Stocks
Stocks with market capitalization of at least $10 billion
S&P 500 Index
A stock index that tracks the share price activity of 500 of the largest corporations on the US market
ADRs
Foreign stocks traded on US stock exchanges; short for American Depositary Receipts
Margin Trading
Trading where investors borrow against their holdings to buy shares on credit
MNCs
Companies that have operations running in more than one country; short for Multinational Corporations
Secular Market
A market cycle (either bull or bear) that lasts anywhere from ten to thirty years
Stagflation
A time of slow market growth and high unemployment accompanied by high inflation
Bull Market
A market on the rise
Bear Market
A market experiencing a 20% decline in any major market index that lasts at least sixty days
Asset Price Bubble
The phenomenon where asset prices rise significantly higher than their true worth, then plummet
Market Correction
When stock prices dip because they’re higher than they should be, and investors suddenly realize that. Corrections are smaller drops than crashes and don’t last as long.
Market Crash
When the total value of the stock market takes a significant nosedive
