© South-Western Educational Publishing Chapter 12 Investing in Stocks Evaluating Stocks Buying and Selling Stock.

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Presentation transcript:

© South-Western Educational Publishing Chapter 12 Investing in Stocks Evaluating Stocks Buying and Selling Stock

GOALS © South-Western Educational Publishing Lesson 12.1 Evaluating Stocks Describe the features of common stock and compare it to preferred stock. Discuss stock investing classifications and why you would choose one over another. Explain how stock values are determined. Discuss factors that affect a stock’s price.

© South-Western Educational Publishing Stock Stockholder Dividend Capital gain

© South-Western Educational Publishing Common Stock Variable dividend Voting rights Proxy

© South-Western Educational Publishing Preferred Stock Fixed dividend No voting rights

© South-Western Educational Publishing Classifying Stock Investments Income versus growth stocks Less-established versus blue chip stocks Defensive versus cyclical stocks

© South-Western Educational Publishing Determining a Stock’s Worth Stock value Par value Market value Stock price Return on investment

© South-Western Educational Publishing Stock Price The company Interest rates The market Earnings per share

© South-Western Educational Publishing Computing a Stock’s Return on Investment Current Profit on Stock = ROI Purchase Price + Commission

GOALS © South-Western Educational Publishing Lesson 12.2 Buying and Selling Stock Describe market channels and the process for buying and selling securities. Describe short- and long-term investment strategies when buying and selling stocks. Explain how to read the stock listings in financial publications and how to use stock indexes.

© South-Western Educational Publishing The Securities Market Securities exchanges Over-the-counter market Bull and bear markets

© South-Western Educational Publishing Investing Strategies Short-term techniques Long-term techniques

© South-Western Educational Publishing Short-Term Investing Techniques Buy on margin Leverage Margin call Sell short

© South-Western Educational Publishing Long-Term Investing Techniques Buy and hold Ride out down times Dividends Stock split Dollar-cost averaging Direct investment Reinvesting dividends

© South-Western Educational Publishing Reading the Stock Listings

© South-Western Educational Publishing Reading the Stock Listings Enger Eng pf Entld Epsco Exlab z ExeB

© South-Western Educational Publishing Stock Progress Chart

© South-Western Educational Publishing Stock Progress Chart Enger Glastn Karbr pf Maxln Totlmb Total Stock Change Names12345(+ or -) Closing Prices for 10 days

© South-Western Educational Publishing Stock Indexes Dow Jones Industrial Average Standard & Poor’s 500 NASDAQ Composite Index