Investment Vocabulary

An employer contribution made to their employees' 401(k) plan based on individual employee's contributions

A retirement savings plan, sponsored through your employer who will often match your contributions, that allows an individual to save for retirement and have the savings grow while deferring taxes until funds are withdrawn

A market where the prices of stocks fall and encourages the investors to sell.

A security in which the investor loans money to a company or government, which then pays regular interest to the bondholder and returns the principal on the bond's maturity date. B in Bond stands for BORROW! They are Borrowing your $!

A measurement of the likelihood that a bondholder will be paid back

A tax levied on profit from the sale of property or an investment

A market in which there is increased stock trading and rising stock prices. Bulls use their horns to buck up = prices of stock going up! People want their stock to go up to make more $.

Profit from the sale of an asset, such as a stock or a bond, is calculated by subtracting the price you initially paid from the price you then sold it for to determine how much your profit is.

Reinvesting earned interest back into the principal to allow money to grow exponentially over time

The annual interest payment on a bond, usually expressed as a percentage of its face value

The practice of investing in a large variety of stocks, bonds, and/or funds as a way to as a way to reduce your overall risk

Money from the profits of a company that is paid out to its shareholders, typically on a quarterly basis

A low-fee portfolio of stocks chosen to track or mimic a stock market index, thereby removing the human element of investing because no one is choosing the individual stocks

An investing tool for INDIVIDUALS to earmark funds specifically for their retirement

A general increase in prices and fall in the purchasing value of money