1. Types of Investments  Savings Savings  Treasury Bills Treasury Bills  Bonds Government Municipal Corporate  Education  Mutual Funds  Real Estate  Commodities  Securities

2. Investment Pyramid Page 500 Speculation Growth Safety Security

4. Level 1 - Financial Security – Cash - 0% interest Savings account - 3 to 5 % CD - 3% money market - 4 to 4.5 % government bonds

5. Level one is used when you have very little disposable income or need to have your assets liquid.

6. Level 2 - Safety and Income - U.S Treasury securities,corporate bonds, income and utility stocks Treasury securities

7. Level 3 - Growth - Income and growth stocks, mutual funds, real estate, convertible bonds

10. Level 4 - Speculation – options, commodities, precious metals and gems, speculative stocks, junk bonds, collectibles Trading Places - commoditites Trading Places - Trading in the pits

11. Notes for video Stock market started in 1792 - Buttonwood Tree agreement Market value of all traded stocks is over 8 trillion Nasdaq - National association of securities dealers automated quotations NYSE - Wall Street - “The Big Board” Started in 1817 DJIA -30 stocks Only one still traded today is GE S & P 500 - top 500 stocks

12. Vocab stock yield dividends capital gain/loss common stock preferred stock blue-chip stocks speculative stock

13. Two Types of Returns Dividends - share of profits Capital gain - selling stocks for a profit

14. Preferred and Common Stock? Preferred stockholders get a share of the assets if the company fails. Usually gets better dividend rates and is paid first. Could be board members or large capital clients. No voting privileges Common Stockholders are everyday people Do not receive any money if the company goes bankrupt or stocks fall. Can invest as little as a few pennies to get started Vote on board members

15. Advantages Buying and Selling Stock on the Market. Level of risk - different levels Liquidity

16. Disadvantages of Buying and Selling Stock on the Market. Day trading Inflation

17. What do you watch when investing? Analyst opinions - Chartist, Fundamentalist Leading Indicators -GDP (Gross Domestic Product) New orders for consumer goods - retail inventory Building permits - housing Orders for equipment - manufacturing unemployment

18. Day Trading? Very risky!! Buying and selling over the internet based on minute by minute changes

19. Mutual Funds video Mutual funds are stocks grouped together which have like tendencies. Your goals and needs are matched with the funds purposes Individuals may purchases small percentages of a stock because there are many investors. This creates less risk. A fund manager or portfolio manager is in charge of the funds performance.

20. Vocab Bonds junk bonds real estate income property undeveloped property

21. A Bond or A Stock? Bonds are loans with a set return on investment Stocks are shares in a company with no guarantee of return on investment

22. Federal Bonds Savings Bonds EE Bonds - pay half of face value I Bonds - interest rate fluctuates, pay face value and earn interest. Treasury Bills, Treasury Notes, Treasury Bonds

24. What Is a Junk Bond? Low or speculative rating, high rate of interest and high rate of risk.

25. Home Ownership Advantages Value usually increases Deduct interest on taxes No further debt once paid off Disadvantages Down payment Less mobility Least liquid of investments Repairs

26. Income Property Property used to generate an income. Farmland for producing and selling crops Apartments, rental properties

27. Undeveloped Property Land intended only for investment purposes Inexpensive to buy Hope for investment to increase

28. Vocab Bull Market Bear Market Dow Jones Index Nasdaq NYSE Securities Insider Trading Market Order Limit Order IPO SEC Stock Certificate

29. Vocab money management budget gross pay net pay fixed expenses variable expense

30. Money Management? The process of planning to get the most from your money.

31. Five Steps In Planning A Budget. Set Goals Estimate Income Estimate Expenses Plan for Savings Balance and Adjust (make equal)

32. Fixed and Variable Expenses. Fixed Expenses occur regularly with the same amount needed (Rent, car insurance) Variable Expenses - change for week to week (groceries, gas, entertainment)