Investments and Retirement

An investment in the ownership of a corporation, usually represented by shares of the business.

• Stock

• Bond

A company or agency asks to borrow money with an agreement to pay you back at a certain interest rate over a time period

• Stock

• Bond

Spreading your money among different types of savings and investments is called:

• Compounding

• Diversification

___________ is the investing concept in which interest is paid on the interest earned as well as the principle, resulting in magnified returns over long periods of time.

• Compounding

• Diversification

A company that issues bonds is actually:

• Selling small pieces of ownership in the company.

• Borrowing money from you.

When evaluating investment choices you should remember:  

• It is wise to diversify

• To put all your eggs in one basket.

A bull market is

• when stock prices fall.

• when stock prices are rising

A bear market is

• when stock prices fall.

• when stock prices are rising

The best strategy for buying stocks is

• invest for the long term.

• make short term investments

A stock market index based on the market capitalization of 500 large companies having common stock listed on the NYSE or NASDAQ

• Dow Jones

• S&P 500