12b -1 fee
The 12b-1 fee is the fee that covers the cost of advertising the mutual fund.
The 12b-1 fee is the fee that covers the cost of advertising the mutual fund.
The 52-week range is the difference between the highest price and the lowest price an asset has traded at over the last 52-weeks (approximately one year, so it is also called the yearly range).
The stocks of most foreign companies that trade in the U.S. markets are traded as American Depositary Receipts (ADRs). U.S. depositary banks issue these stocks. Each ADR represents one or more shares of foreign stock or a fraction of a share. If you own an ADR, you have the right to obtain the foreign stock it represents, but U.S. investors usually find it more convenient to own the ADR. The price of an ADR corresponds to the price of the foreign stock in its home market, adjusted to the ratio of the ADRs to foreign company shares.
An annuity is a product sold by insurance companies. You pay for the annuity through a lump sum or by making payments over time, then the insurance company invests your money, paying you the residuals at the end of the term. One giant pro is that an annuity has the ability to pay out regular payments each month. These payments could provide a supplemental income during your retirement, even enough to cover your regular expenses. These are complex arrangements orchestrated by an insurance company and as such, come with high fees. Most will have administrative fees, mortality, and expense fees that cover the costs and risks of insuring your money.
The term annual percentage rate of charge, corresponding sometimes to a nominal APR and sometimes to an effective APR, is the interest rate for a whole year, rather than just a monthly fee/rate, as applied on a loan, mortgage loan, credit card, etc. It is a finance charge expressed as an annual rate
Asset allocation refers to the strategy of dividing your investments among different asset categories, such as stocks, bonds, real estate, cash, and cash alternatives. Asset allocation aims to control risk by diversifying an investment portfolio.
The opposite of a bull market is a bear market, defined as a point in time in which the market is seeing challenges and investor sentiment is on the decline. Just like bull markets, bear markets can span weeks, months, or years.
This term refers to the individual who inherits the funds or property because of a financial account, trust, or will.
The amount by which the ask price exceeds the bid price for an asset in the market. The bid-ask spread is essentially the difference between the highest price that a buyer is willing to pay for an asset and the lowest price that a seller is willing to accept.
Bitcoin is a cryptocurrency. It is a decentralized digital currency without a central bank or single administrator that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries.
Blockchain.com is a Bitcoin block explorer service, as well as a cryptocurrency wallet supporting Bitcoin, Bitcoin Cash, and Ethereum. They also provide Bitcoin data charts, stats, and market information
Blue-chip stocks are the term for stocks issued by companies with name recognition that experience consistent growth and usually pay dividends.
Banks and brokerage firms assign a brokerage account number code for each of your brokerage accounts. This number functions much like a username, and it allows the electronic as well as human interface within your brokerage firm to identify you.
Budgeting just means establishing a framework for your personal money management that factors in the realities of your financial situation and your unique financial objectives.
A bull market is when the market is doing well and growing at a steady pace. In a bull market, investor sentiment is optimistic and stock prices rise significantly following a previous decline. Bull markets can last several months or even span into years.
Buying power is the amount of money you have available to buy stock. Typically, buying power will match your cash balance, unless you have an outstanding/pending order.
Callability is the option for some bonds to be paid off prior to maturity. If the bond is paid off before reaching maturity, that usually means the bondholder will get some extra money. Callability can also apply to prefered stocks.
A capital gain occurs when you sell an investment at a profit. Capital gains can receive favorable tax treatment because the rules generally favor capital gain over ordinary, earned income.
Capital gains are measured by the difference between the amount realized in a sale and the basis on the asset you sold. You pay taxes on the difference.
A clearing house is a financial institution formed to facilitate the exchange of payments, securities, or derivatives transactions. The clearing house stands between two clearing firms. Its purpose is to reduce the risk of a member firm failing to honor its trade settlement obligations.
Closing price generally refers to the last price at which a stock trades during a regular trading session. For many U.S. markets, regular trading sessions run from 9:30 a.m. to 4:00 p.m. Eastern Time.
As can be expected, blue-chip stocks are in the major indexes: the S&P 500, the Dow Jones Industrial Average, and the NASDAQ-100.
A convertible bond is a bond that can be turned into a certain number of shares of common stock in the company that issued the bond or in exchange for equal cash value.
These are bonds put out by commercial undertakings such as corporations and LLCs. Corporate bonds offer high yields but are not favored by the tax code. Upwards of 40% to 50% from corporate bonds may end up going toward taxes.
A person or company to whom money is owed.
Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase
The idea behind diversification is that having a variety of investments will yield a greater return while assuming lower risk.
One way to practice diversification is to create your portfolio of stocks. You can do this by investing in companies you believe in, and using a combination of first-hand knowledge on a category, additional research, and insights gleaned from trusted friends and experts.
Public is the first social investing app, which means that its users can see investments made by people in their network and start conversations and learn from the people they trust.
The term dividend includes any distribution of property to shareholders to the extent made out of accumulated or current earnings and profits.
Earnings per share
The personal representative is whoever is named in the will and/or found themselves appointed by a probate court as the person responsible for realizing the desires of the deceased. This entails clouding out accounts, distributing assets in the manner instructed by the departed, managing paperwork, paying creditors, etc.
Extended-hours trading is stock trading that happens either before or after the trading day of a stock exchange, i.e., pre-market trading or after-hours trading. After-hours trading is the name for buying and selling of securities when the major markets are closed.
FAANG is an acronym referring to the stocks of the five most popular and best-performing American technology companies: Facebook, Amazon, Apple, Netflix and Alphabet (formerly known as Google).
As fiduciaries, investment advisers are required to act in the best interest of their clients and not place their own interests ahead of their clients. The IAA has consistently taken the position that all professionals in the business of providing investment advice about securities to clients should be subject to similar fiduciary principles.
First In, First Out, commonly known as FIFO, is an asset-management and valuation method in which assets produced or acquired first are sold, used, or disposed of first. For tax purposes, FIFO assumes that assets with the oldest costs are included in the income statement cost of goods sold (COGS). The remaining inventory assets are matched to the assets that are most recently purchased or produced.
Financial literacy is the ability to understand and effectively apply various financial skills, including personal financial management, budgeting, and investing. Financial literacy helps individuals become self-sufficient so that they can achieve financial stability.
In the United States, the Financial Industry Regulatory Authority, Inc. is a private corporation that acts as a self-regulatory organization. FINRA is the successor to the National Association of Securities Dealers, Inc. and the member regulation, enforcement, and arbitration operations of the New York Stock Exchange.
In economics, fixed costs, indirect costs or overheads are business expenses that are not dependent on the level of goods or services produced by the business. They tend to be time-related, such as interest or rents being paid per month, and are often referred to as overhead costs.
A full-service broker is an equivalent of working with an actual stockbroker and therefore provides a more personalized, white-glove experience than basic online brokers. Once you find a full-service brokerage, he or she will take the time to get to know you both personally and financially. The broker will take into account certain factors about your life when crafting a financial plan with objectives that are tailored to your financial realities and life-stage. Full-service brokers can help with other services as well, such as budgeting, retirement planning, and providing general financial advice. Given the high-touch nature of their client relationships, full-service brokers are a more expensive option but can be worth the investment for people who value personalization. Some accounts can be set up for as low as $1,000.
These are bonds issued by sovereign governments. They are backed by the full faith and credit of the issuing country, which can take whatever steps necessary to pay off the bond. Governments put out various different types of bonds to finance all sorts of endeavors. Even though government bonds are stable and, as a result, carry lower risk, they often deliver a significant return.
This is the person who set up the trust in the first place.
Gross pay is the amount of money your employees receive before any taxes and deductions are taken out
A growth investment strategy focuses on capital appreciation. Growth investors look for companies that exhibit signs of above-average growth, through revenues and profits, even if the share price appears expensive. A relatively riskier strategy, growth investing involves investing in smaller companies that have a high potential for growth, blue chips, and emerging markets. This is a research-heavy approach to investing that is best handled by seasoned investors.
A Good-Til-Cancelled (GTC) order is an order to buy or sell a stock that lasts until the order is completed or cancelled. Brokerage firms typically limit the length of time an investor can leave a GTC order open. This time frame may vary from broker to broker. Investors should contact their brokerage firms to determine what time limit would apply to GTC orders.
A high-yield savings account is an account that pays the account holder a higher-than-average interest rate. If the average savings account in the U.S. offers an interest rate of 1%, for example, then a high-yield savings account might offer a 2% to 5% or higher interest rate.
You can deposit money into a high-yield savings account any time you wish to make your account balance grow. You may also make withdrawals from the account, though you may be limited as to how many times you can take your money out in a given month.
An impulse purchase or impulse buying is an unplanned decision to buy a product or service, made just before a purchase. One who tends to make such purchases is referred to as an impulse purchaser or impulse buyer.
In the money refers to an option contract that, if it were exercised today, would be worth more than $0. A call option is said to be in the money when its exercise price is below the current price of the underlying asset
A payment amount determined by the interest rate on an account. As a borrower, an interest payment represents the rate charged for being lent funds. As an investor, interest payments represent income on earned on cash accounts or fixed and variable rate securities.
An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited or borrowed. The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, the compounding frequency, and the length of time over which it is lent, deposited or borrowed.
A market cap is the means by which we quantify the size and value of a company. Blue-chip stocks tend to be large-cap stock, which translates into a market valuation that exceeds $10 billion.
Liabilities are amounts of money that a company owes to others. This can include all kinds of obligations, like money borrowed from a bank to launch a new product, rent for use of a building, money owed to suppliers for materials, payroll a company owes to its employees, environmental cleanup costs, or taxes owed to the government. Liabilities also include obligations to provide goods or services to customers in the future.
A long-term investing strategy means investing in companies prepared to endure the bad times and that have a plan for the good times. Pricing power, an influential brand presence, and other competitive advantages can mean a lot more than a high speculative valuation.
Market capitalization is the value of a corporation determined by multiplying the current market price of one share of the corporation by the number of total outstanding shares.
Regular trading hours for stocks traded on exchanges and certain other markets are from 9:30 a.m. to 4:00 p.m. Eastern Time.
Mid-cap companies tend to have a market value somewhere between $2 billion and $10 billion and operate within sectors that show the promise to experience quick growth. Not surprisingly, successful companies in these sectors are likely to be growing, as well. Mid-cap stocks carry more risk than large-cap counterparts because they are not as established or secure yet. At the same time, that is what makes them an attractive opportunity for some investors. Examples of mid-cap stocks include 3D Systems Corp (a maker of 3D printers) and the home appliance company Whirlpool.
To entice you to keep your high yield savings account as full of cash as possible, banks and credit unions will waive account maintenance fees and offer their most competitive APY as long as your balance stays above the account minimum balance requirement.
If your account balance dips below that amount in a given month, you may be required to pay a maintenance fee on your account and earn a lower APY on your money until your balance rises above the minimum balance. So before you choose a savings account, be sure the minimum balance on it is something you can maintain.
Money market funds invest in short-term bonds issued by governments or corporations. Bonds are small loans that allow investors to make a profit off interest payments. Money market funds are low risk because the can only make high-quality investments.
When the value of your mutual fund goes up, you make money. The money you make can then be reinvested into the mutual fund so that you have even more shares. When those shares make more money, you can reinvest again so that you get a greater share of the profit. This process can continue up to the point when you decide to sell your shares.
New York Stock Exchange
For a little more money per transaction, you can work with a discount broker with assistance. These platforms provide an additional layer of support relative to spartan online brokers and may provide more information about the stocks you are trading or published newsletters with tips.
The Financial Industry Regulatory Authority (FINRA) regulates broker-dealers that operate in the over-the-counter (OTC) market. Many equity securities, corporate bonds, government securities, and certain derivative products are traded in the OTC market. The OTC Bulletin Board (which is a facility of FINRA), and OTC Link LLC (which is owned by OTC Markets Group, Inc., formerly known as Pink OTC Markets Inc.), for example, operate within the OTC market, particularly with respect to OTC equity securities.
Penny stocks or companies that are listed on the OTC typically lack reliable information and liquidity and we strongly recommend learning more about the risks from the SEC here.
The great news though is that you can avoid the extra risk of buying cheap, volatile penny stocks because here at Public we have developed the technology to slice stocks, allowing our members to buy stock in public companies for any amount of money regardless of the share price!
A put provision is an opportunity that some bonds have to be sold back to the bond issuer at a certain date before the bond reaches maturity.
A secured bond is backed by a particular type of collateral. In the event of a default, that asset is divided between bondholders.
Small-cap companies have a market value ranging from $300 million and $2 billion. A small-cap company may be at the start of its lifespan, serve a niche sector, or exist within a developing arena. Small-cap companies are said to be riskier investments because of their age, size, and the industries they serve. They are also more sensitive to market volatility given their limited resources. However, if you find the right company you could be rewarded handsomely for investing early.
Speculative stocks belong to fledgling companies with unknown futures. A startup is an example of a speculative stock. They are considered higher risk investments.
A stock, also known as an equity, is when you get a share of ownership in a company. Stocks are sold at the price of each share, the cost of which varies from company to company.
A stop-limit order is an order to buy or sell a stock that combines the features of a stop order and a limit order. Once the stop price is reached, a stop-limit order becomes a limit order that will be executed at a specified price (or better). The benefit of a stop-limit order is that the investor can control the price at which the order can be executed.
A stop order, also referred to as a stop-loss order, is an order to buy or sell a stock once the price of the stock reaches a specified price, known as the stop price. When the stop price is reached, a stop order becomes a market order. A buy stop order is entered at a stop price above the current market price. Investors generally use a buy stop order to limit a loss or to protect a profit on a stock that they have sold short. A sell stop order is entered at a stop price below the current market price. Investors generally use a sell stop order to limit a loss or to protect a profit on a stock that they own.
A ticker symbol or stock symbol is an abbreviation used to uniquely identify publicly traded shares of a particular stock on a particular stock market. A stock symbol may consist of letters, numbers or a combination of both.
An unsecured bond is not backed by any asset. It gets its worth from the credibility of the bond issuer.
If you can afford about $100/month, then you can buy U.S. Treasury securities, which can mature at a rate that falls between 30 days and 30 years. Additionally, you can use Treasury Direct to buy Treasury Inflation Securities (TIPS). TIPS pay interest and adjust for inflation.
As we mentioned, a value investment strategy means to buy stocks that are cheaper than they should be and hold onto them until their value rises. This buy and hold strategy demands a patient investor but if the right call is made, handsome payoffs could be gained. All investors should understand at least the basics of value investing and what is, in essence, delayed gratification
A wash sale occurs when you sell or trade securities at a loss and within 30 days before or after the sale you:
Year to date (YTD) refers to the period beginning the first day of the current calendar year up to the current date. YTD percent change refers to the comparison of the current YTD to the same time period a year ago.
Disclosure: The above content provided and paid for by Public and is for general informational purposes only. It is not intended to constitute investment advice or any other kind of professional advice and should not be relied upon as such. Before taking action based on any such information, we encourage you to consult with the appropriate professionals. We do not endorse any third parties referenced within the article. Market and economic views are subject to change without notice and may be untimely when presented here. Do not infer or assume that any securities, sectors or markets described in this article were or will be profitable. Past performance is no guarantee of future results. There is a possibility of loss. Historical or hypothetical performance results are presented for illustrative purposes only.
We use cookies and similar technologies as described in our privacy policy. You can manage your cookie settings at any time.
Got it! ×