Stocks represent ownership in publicly traded companies. There are two main types of stock: common stock which offers voting rights but no guaranteed dividends, and preferred stock which pays fixed dividends but offers no voting rights. Companies list their stocks on exchanges like the NYSE or NASDAQ, identified by ticker symbols. Stock prices fluctuate based on supply and demand as well as expectations about company performance. Investing in stocks offers the potential for high returns but also risks losing money if prices decline.

1. Securities Market Basics
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2. What are Stocks?
• Stock is ownership in a publicly traded
company.
• Stock is a claim on the company’s
assets and earnings.
• The more stock you have, the greater
your claim as an owner.
• Watch: https://youtu.be/JrGp4ofULzQ
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3. Some top stocks
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4. Types of Stock
• Common Stock – most common
form of stock.
• One vote per share
• Dividends are not guaranteed
• Preferred Stock
• Fixed dividend
• May not include voting
• Companies may customize other
“classes” of stock.
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5. Ticker Symbols
• All securities traded on the stock
exchange have a ticker symbol
• Microsoft (MSFT)
• Southwest Airlines (LUV)
• Ford Motor
Company (F)
• Google (GOOG)
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6. Initial Public Offering (IPO)
• The first time a stock is sold to the
public
• Sold in the Primary Market
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9. The Markets
• Primary Markets – where stocks are
created
• Secondary Markets – investors trade
previously issued stocks
• The Stock Market
• Companies are not involved in the
buying and selling of their stock.
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10. The Exchanges
• Where Stocks are Bought and Sold
• New York Stock Exchange (NYSE)
• American Stock Exchange (AMEX)
• NASDAQ
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11. The Indices (index)
• A collection of stocks—representative
of the stock market
• Dow Jones – 30 most significant stocks
in the stock market
• S&P 500 – 500 largest companies on the
US stock market
• NASDAQ Composite – all stocks on the
NASDAQ
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12. How Do You Make Money in the Market?
1. Stock Price Goes Up and You Sell
• Buy low, sell high
2. Dividends
• Not all companies pay dividends
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13. Why Invest in Stock
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15. What Causes Stock Prices to Change?
• Supply and Demand
• Earnings and Expectations
• Sentiments and Attitudes
• Economic Indicators
• Follow the Leader (volume)
• Anything 
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16. Why Invest in Stocks?
• The return on investments in the
market are 3-4 times the annual return
of inflation, savings and treasury bonds
• You can make good money in the
market
• You can loose money too……
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17. How Should I Invest?
• What are your financial goals?
• What is your risk tolerance?
• Return rises with risk
• Do you want to actively manage your
portfolio?
• Diversify
• Don’t put all your eggs in one basket!
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18. Where do I Start?
• Learn the Basics
• Setup a brokerage account
• Full-service vs. discount?
• The Internet provides a variety of discount
brokerage firms (do it yourself)
• Fees, commission, minimum balance
• Keep it simple as you learn
• Learn about other investment vehicles
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19. Reading a Stock Table
• Ticker Symbol – the alphabetic name that identifies the stock.
• Price – current stock price
• Open – current day’s opening price
• Close – the last trading price from the previous day
• Net Change – the net change from the previous day
• Day’s Range – the current day’s price range
• 52-Week Hi and Low – the highest and lowest prices at which a
stock has traded over the past year
• Trading Volume – the total number of shares traded for the day
• Market Capitalization – the market value of the company
• Dividend Per Share – annual dividend payment per share.
• Price/Earnings Ratio – the current stock price divided by earnings
per share for the last four quarters Click to Yahoo Finance
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20. Bulls and Bears
• Bull Market – the economy is great
and stock prices are rising
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21. Bull and Bears
• Bear Market –the economy is bad and
a recession is looming
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22. Beyond the Basics
• Bonds – a debt investment in which an investor
loans money to an entity (corporate or
governmental) that borrows the funds for a defined
period of time at a fixed interest rate.
• Buying on Margin - borrowed money that is used
to purchase securities.
• Selling Short - a trade in which the investor
borrows a security and sells it to another investor in
market.
• Dollar Cost Average - buying a fixed dollar
amount of a particular investment on a regular
schedule
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23. Options vs. Futures
• Options give the holder the right to buy or
sell the underlying asset at expiration, a
futures contract is an obligation to fulfill the
terms of a contract.
• Options: A privilege, sold by one party to
another, that gives the buyer the right, to buy or
sell a stock at an agreed-upon price within a
certain period or on a specific date
• Futures: A financial contract obligating the buyer
to purchase an asset at a predetermined future
date and price (i.e. currency, commodities)
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