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Investment Options.

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Presentation on theme: "Investment Options."— Presentation transcript:

1 Investment Options

2 Shares A unit of ownership in a corporation or financial asset.

3 Stock The shares of a particular company or corporation.

4 Stock Market A particular market where stocks are traded. Example:
NYSE – New York Stock Exchange

5 Stockbrokers A broker who buys and sells stocks and other securities for customers.

6 Investors Person, or persons, who put (money) to use, by purchase or expenditure, in something offering potential profitable returns, as interest, income, or appreciation in value (A person who commits capital with the expectations of making a profit)

7 Profit It is the money made after accounting for all the expenses.
Total revenue – total expenses

8 Market Value The value of a business, property, stock, etc, in terms of what it can be sold for on the open market; current value.

9 Commission A service charge assessed by a broker or investment advisor in return for providing investment advice and/or handling the purchase or sale of a security.

10 Dividends A sum of money or shares paid to shareholders of a corporation out of earnings

11 Mutual Funds An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets.

12 Mutual Funds (con’t) Mutual funds are operated by money managers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus.

13 Advantages of Mutual Funds
they give small investors access to professionally managed, diversified portfolios of equities, bonds and other securities. Increased diversification Daily liquidity Professional investment management Service and convenience Government oversight Ease of comparison

14 Disadvantages of Mutual funds
Fees Less control over timing of recognition of gains Less predictable income No opportunity to customize

15 Mutual Funds Video

16 401(K) A qualified plan established by employers to which eligible employees may make salary deferral (salary reduction) contributions on a post-tax and/or pretax basis. Employers offering a 401(k) plan may make matching or non-elective contributions to the plan on behalf of eligible employees and may also add a profit-sharing feature to the plan. Earnings accrue on a tax-deferred basis. 

17 Roth 401(k) An employer-sponsored investment savings account that is funded with after- tax money. After the investor reaches age 59.5, withdrawals of any money from the account (including investment gains) are tax-free. Unlike the Roth IRA, the Roth 401(k) has no income limitations for those investors who want to participate - anyone, no matter what his or her income, is allowed to invest up to the contribution limit into the plan.

18 401(K) vs. Roth 401(k)

19 Individual Retirement Account (IRA)
An investing tool used by individuals to earn and earmark funds for retirement savings.

20 Roth IRA An individual retirement plan that bears many similarities to the traditional IRA, but contributions are not tax deductible and qualified distributions are tax free. Similar to other retirement plan accounts, non- qualified distributions from a Roth IRA may be subject to a penalty upon withdrawal. 

21 Ira vs. Roth Ira

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