Thursday, March 4, 2010

My Investment Strategy

My ideal investment strategy would be to invest in after, long term stocks which I feel will rise over time. It is much easier to predict a stock's growth over a long period of time than it is to have a stock burst in a short amount of time. I would probably look into buying stocks like CDE,DECK, etc and I based my decisions on their 2-5 year charts, and opinion of others

Friday, February 5, 2010

Stock Market

1. What exactly is a stock and why do companies sell stock in the first place?
A stock is a security that represents ownership in a publicly traded company and is sold by the share. The companies sell stock because, they need the money to run the business, so they will trade the right to part of the future profits for cash now.

2. What is the difference between a public and a private company?

The different between a public and a private company is that a public company is one whose stock is traded by the public, listed on an exchange such as the New York Stock Exchange or NASDAQ. A private company is one whose stock is generally held by one shareholder or a small group of shareholders.

3. What is the Dow Jones Industrial Average?
The Dow Jones Industrial Average is an index of thirty, blue chip stocks that are traded in the United States. It is believed that by looking at the companies on the list, a person can get a general picture of how the market as a whole is performing. The Dow is perhaps the most quoted and followed index in the world, and dates back to May 26, 1896. It was then comprised of 12 stocks and opened at 40.94.


4. What is a blue chip stock?
A "blue chip" is the nickname for a stock that is thought to be safe, in excellent financial shape and firmly entrenched as a leader in its field. Blue chips generally pay dividends and are favorably regarded by investors.


5. What is the New York Stock Exchange and the NASDAQ?
The world largest exchange for trading stocks and bonds.

6. What is a mutual fund and how do they operate, why can they be good?
The mutual fund is managed by a professional investment manager who buys and sell securities for the most effective growth of the fund. As a mutual fund investor, you become a shareholder of the mutual fund company. When they are profit you will earn dividends. And you'll be making alot of money.

7. What are some of the biggest companies on the stock market (in total value of their stock?)
  • Amex
  • CBOE
  • Dow Jones & Company
  • NASDAQ
  • Russell Indexes
  • Standard & Poor's

8. What is the PE ratio of a stock?
PE ratio is equal to stock's market capitalization divided by its after tax earning over a 12 month period.

9. What is a stock dividend?
A stock dividend is a dividend that is paid to shareholders in the form of additional shares of stock instead of cash.