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WHAT
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‘LONG T
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NA
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WHAT
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‘TAKE A
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IF I A
SKED YOU T
O LEND
ME SOME M
ONEY SO I
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OULD YO
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T RIS
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WH
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I LL I N
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O
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K OR
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T TA K E T
HE
RI S
K ?
SAVING FOR SHORT TERM GOALS
• Best done with a savings account
• Short term goals include…
SAVING FOR LONG TERM GOALS
• Best done with some form of investment
• Long term goals include…
THE DIFFERENCE BETWEEN SAVING & INVESTING
Investing involves RISK.
You may make more money than in a savings account, but
you can lose it too.
TYPES OF INVESTMENT:
• Stocks
• Bonds
• Real Estate
It’s important to research your investments before
you buy.
STOCKS
• Purchasing stocks means you’re purchasing a portion, or share, of the company
• Owning a share means you have part ownership of the company
• Share prices depend on a variety of factors including past performance and reputation, government policies and world events
STOCKS CONT’D
• Individuals try to buy stock they believe will go up over time
• If the price goes up = opportunity to sell and gain money
• If price goes down = investors lose money
SOME COMPANIES PAY A DIVIDEND
(A PORTION OF THEIR PROFIT)
TO INVESTORS ON A REGULAR BASIS.
Dividend – Part of a companies profits paid to share holders
Stock Symbol – An abbreviation of the company name
Last – the most current share price of the stock
CHG – change in share price from the day before
WHAT IS NASDAQ & THE DOW JONES?
NASDAQ – World’s largest electronic stock market trading shares from a number of different industries
Dow Jones – industrial publisher that tracks the stock performance of the top 30 U.S. companies
If NASDAQ/Dow Jones is UP = stock prices generally are up
If NASDAQ/Dow Jones is DOWN = stock price generally are down
WHAT IF YOU DON’T HAVE TIME TO WATCH STOCKS?
You can use MUTUAL FUNDS!!!
• Mutual funds allow you to become an investor in a number of different companies
• You become a part of a group of people who pool their money together and pay a professional investment manager to buy stocks
• You spread the risk – you might lose in one company, but gain in another
• NOT ALL MUTUAL FUNDS MAKE GAINS!!!