Bluff

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What’s the difference between
   saving and investing?
     Saving=putting money aside
  Investing=putting money to use in
     order to make more money
What’s the formula to
 calculate interest?
        I=PRT
What are the 3 savings plans?

    Savings account, CD, money
          market account
This type of savings plan requires
a minimum deposit and interest is
  earned based on government
and corporate securities. Usually
 withdrawals are allowed without
             penalties.
       Money market account
This type of savings plan requires
  a minimum deposit, money to
 remain deposited for a period of
time without penalties. Penalties
   may be assessed if money is
 withdrawn before specified time
        Certificate of deposit
Name 3 investing options.
                 Stocks
                 Bonds
 Mutual Funds and Exchange-traded Funds
               Real Estate
              Commodities
               Collectibles
What’s the difference between
common stock and preferred
           stock?
 Preferred stock pays dividends before common stock is paid.
    Preferred stockholders do not have voting powers; but
     common stockholders are invited to annual corporate
    meetings and permitted to one vote per share of stock
                             owned.
       Preferred stock is less risky than common stock.
 What are dividends?

Part of the profit shared with the
          stockholders
How are stockbrokers paid?

        Commission
What is the largest stock
 exchange in the US?
          NYSE
Name 2 economic factors that
 could influence investors in
       selecting stock.
                Inflation
             Interest rates
          Consumer spending
              Employment
 This ratio is the relationship
between a stock’s selling price
         and it’s yield.
      Price per earnings ratio
What’s the formula to
  calculate yield?
current value – original value
        Original value
A promissory note to pay back a
specified amount of money at a
 stated rate on a specific date.
             Bond
These bonds are issued by local
and state governments for public
        service projects
         Municipal bonds
 An example of these bonds are
the EE bond interest is paid once
the bond is cashed. The HH bond
   interest is paid twice a year,
     which may be considered
               income.
         US Savings Bonds
What’s the time frame for
     treasury bills?
      91 days to a year
What’s the time frame for
   treasury notes?
        1-10 years
What are corporate bonds
   used to finance?
 Expansion, new products, debt
        repayment, etc
This type of mutual fund looks for
 quick growth, but also have an
  higher risk than other stock.
    Aggressive-growth stock funds
   This type of mutual fund
concentrates on stocks that pay
      regular dividends.
          Income funds
This type of mutual fund invest in
   a variety of company stock
        around the world.
         International funds
    This type of mutual fund
purchase stocks of companies in
      the same industry.
          Sector funds
   This type of mutual fund
concentrate in corporate bonds.
           Bond funds
This type of mutual fund invest
  in both stocks and bonds.
         Balanced funds
What does ETF stand for?

    Exchange-traded fund
Name one advantage of
  owning real estate.
 tax benefits, increased equity, and
        pride of ownership
Name one disadvantage of
   owning real estate.
   property taxes, interest payments,
       property insurance, and
              maintenance
What are commodities and
        futures?
    grain, livestock, and precious metals.
  Commodity investors usually agree to buy
  and sell for an amount at a specified price
  in the future. Examples may include rice,
                cattle, and gold.
Name one example of a
     collectible.
  art work, antique furniture, and
        autographed items.
What are 2 of the 4 evaluation
factors for investment options?
   Safety and risk: how likely are you to lose your money?
 Potential yield: how much profit are you likely to make on this
                          investment?
  Liquidity: how fast can you turn this investment into cash?
    Taxes: how much will you have to pay in taxes for this
                          investment?