StocksBy: Devin Hawthorne, Danny Goode, Morgan Booker, Keaton Marlow, Erica Shambo, and Tommy Roach!!!!!!!!

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A stock is…• The shares of a particular company or corporation.

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!

Stock Exchanges….• Facilities that allow investors to

purchase or sell existing stocks• Ex: New York stock Exchange,

American stock exchange, Over-The-Counter, Electronic Communication Networks

• Electric communication Networks (ECN)- computer APP that help you purchase stock by matching stocks

Stock exchanges• NYSE- New York Stock Exchange- most popular,

Floor traders (traders at a stock exchange who execute trades to fulfill orders placed by investors)

• NASDAQ Stock Market- free stock quotes, stock exchange prices, stock market news, and online stock trading tools

• AMEX American stock exchange- has about 800 stocks that are generally smaller and less actively traded

• Specialists- traders who help to make a market in one or more stocks by taking the position opposite of orders placed by clients

• Over-the-counter(OTC) market- an electronic communications network that allows investors to buy or sell securities

• Market makers- traders who work through (OCT) and get commision

Stock Quotations• What? They provide info. About the

price of a stock the day before or over a time period

• Where? They are available online, through stock brokers, or in financial newspapers.

Buying and selling stocks• Selecting a broker • Brokers and analysts tend to be optimistic•May encourage frequent trading (they work for commission)• There is a tax effect of trading

• Brokers have online reviews and histories you can look at

• Types• Discount brokerage firm- does transactions you want, no advice• Full-service brokerage firm- give advice and does the desired transactions

Buying and selling stocks• Name of stock• Ticker symbol: the abbreviated term used to identify stocks

• Number of shares• Round lot: shares Purchased or sold in multiples of 100.• Odd lot: shares Purchase./Sold in multiples less than 100

• Market Order or Limit Order•Market order: An order to buy or sale a stock at its prevailing market price• Limit order: an order to buy or sale a stock at its set limit

Buying and selling stocks• Stop orders• Stop order: an order to execute a transaction when the

stock price reaches a set level (special form of limit order)• Buy stop order: an order to buy a stock when it reaches a

set level• Sell stop order: an order to sell a stock when it reaches a

set level• Buying stock on margin• On margin: purchasing a stock with a portion of the funds

borrowed from a brokerage firm• Federal Reserve limits margin to 50%• Margin call: a request from a brokerage firm for the

investors to increase the cash in the account in order to bring the margin back up to the minimum level

Analysis of the firm• Annual report• Balance sheets- show where funds come from• Income statement- measures their money and where it

goes• Technical analysis- the valuation of stocks based

on historical price patterns• Fundamental analysis- valuation of stocks• a complete analysis of the firm such as its worth,

profit, the economy, and planning for the future.

Activity• You start with $1,000• You must invest most of your money in stocks• You can not go into debt when you purchase the

stocks• After re-selling the stocks the person with the

most money wins

Available stocks

390 800

52

77 30

38 23 29

Apple

1rst

5th 10th

15th

22nd

0100200300400500600700800900

applegoogle

1st 5th 10th

15th

22nd

0102030405060708090

verisonwalmartmicrosoftat&tyahoogeneral motors

Sale price

822

30 34 40 30

29100350