COMMON INVESTMENT TERMS EXPLAINED: Part 9


Welcome back to another segment of our series on investment terms! Today we’re jumping into stock market terms, so buckle up and take a look.

Annual Report: All companies are required by the SEC to produce an annual report. The report is sent to all shareholders and provides the financial results for the previous fiscal year. Accredited accounting firms review and verify the results.

Balance Sheet: This is a full accounting of a company’s assets, liabilities, equity, and net worth at a certain point in time. A balance sheet is included as part of the annual report and effectively tells you what the company is worth. 

Bear Market: A bear market is one where there are considerable and long-term declines in the value of the market, typically for two or more quarters. There is not a precise or agreed-upon definition for this common term.

Blue Chip: The most stable and prestigious stocks on the stock market. Companies like General Electric and IBM are frequently considered to be Blue Chip stocks.

Bull market: The opposite of a bear market is a bull market. Two quarters of significant stock market growth and a positive outlook are characteristics of a bull market. This also usually means that there are more buyers than sellers, which drives up prices.

Thanks for reading! We’ll be back soon with more stock market terms.

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