Plain-language overview of stocks, bonds, mutual funds, ETFs, and other common financial instruments.
40 cards · basic cards · AI-written, checked twice. Edit anything.
- What is a stock?
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A share of ownership in a company.- What does equity mean in finance?
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Ownership interest in a company.- What is a bond?
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A loan made to a company or government that pays back principal plus interest.- What is the face value of a bond?
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The principal amount to be repaid at maturity.- What is a coupon payment?
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Periodic interest payment made to a bond holder.- What does yield to maturity (YTM) measure?
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The total return on a bond if held to maturity.- What is a mutual fund?
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A pool of money from many investors invested in a diversified portfolio of securities.- What is an ETF?
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An exchange-traded fund that trades on stock exchanges like a stock.- How does an ETF differ from a mutual fund?
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ETFs trade continuously throughout the day; mutual funds price once daily after market close.- What is a stock dividend?
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A payment to shareholders from company profits.- What is a stock split?
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Division of existing shares into a greater number of shares, each with lower price.- What is an option?
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A contract giving the right, but not obligation, to buy or sell an asset at a set price by a certain date.- What is a call option?
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The right to buy an asset at a set price (the strike price).- What is a put option?
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The right to sell an asset at a set price (the strike price).- What is a futures contract?
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An agreement to buy or sell an asset at a predetermined price on a future date.
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