Itb Chap 19


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Itb Chap 19

  1. 1. Savings and Investment Strategies 19-1 Saving and investment planning 19-2 Stock investments 19-3 Bonds and mutual funds 19-4 Real estate investments 19-5 Other investments 19
  2. 2. LESSON 19-1 Saving and Investment Planning <ul><li>Goals </li></ul><ul><li>Explain the basics of saving and investing. </li></ul><ul><li>Identify types of savings and investments. </li></ul><ul><li>Discuss factors to consider when evaluating savings and investment alternatives. </li></ul>
  3. 3. Key Terms <ul><li>saving </li></ul><ul><li>investing </li></ul><ul><li>yield </li></ul><ul><li>liquidity </li></ul>
  4. 4. SAVING AND INVESTMENT BASICS <ul><li>Savings and investment activities </li></ul><ul><li>Determine investment goals </li></ul><ul><li>The growth of savings </li></ul><ul><ul><li>Interest </li></ul></ul><ul><ul><li>Compound interest </li></ul></ul>
  6. 6. >> C H E C K P O I N T <ul><li>How does saving influence economic activity? </li></ul>
  7. 7. SAVING AND INVESTMENT CHOICES <ul><li>Savings plans </li></ul><ul><ul><li>Savings account </li></ul></ul><ul><ul><li>Certificate of deposit </li></ul></ul><ul><ul><li>Money market account </li></ul></ul><ul><li>Securities </li></ul><ul><ul><li>Stock investments </li></ul></ul><ul><ul><li>Bond investments </li></ul></ul><ul><ul><li>Mutual funds </li></ul></ul>
  8. 8. SAVING AND INVESTMENT CHOICES <ul><li>Alternative investments </li></ul><ul><ul><li>Real estate </li></ul></ul><ul><ul><li>Commodities </li></ul></ul><ul><ul><li>Collectibles </li></ul></ul>(continued)
  9. 9. >> C H E C K P O I N T <ul><li>What are the nine main categories of saving and investment alternatives? </li></ul>
  10. 10. EVALUATING SAVINGS AND INVESTMENTS <ul><li>Safety and risk </li></ul><ul><li>Potential return </li></ul><ul><li>Liquidity </li></ul><ul><li>Taxes </li></ul>
  11. 13. >> C H E C K P O I N T <ul><li>What are four factors to consider when selecting an investment? </li></ul>
  12. 14. LESSON 19-2 Stock Investments <ul><li>Goals </li></ul><ul><li>Compare the two major types of stock. </li></ul><ul><li>Describe the activities involved with buying or selling stock. </li></ul><ul><li>Identify factors that affect the value of a stock. </li></ul>
  13. 15. Key Terms <ul><li>preferred stock </li></ul><ul><li>common stock </li></ul><ul><li>stockbroker </li></ul><ul><li>stock exchange </li></ul><ul><li>market value </li></ul>
  14. 16. TYPES OF STOCK <ul><li>Preferred stock </li></ul><ul><li>Common stock </li></ul>
  15. 17. >> C H E C K P O I N T <ul><li>How does preferred stock differ from common stock? </li></ul>
  16. 18. STOCK TRANSACTIONS <ul><li>Using a stockbroker </li></ul><ul><li>Online investing </li></ul><ul><li>Stock exchanges </li></ul><ul><li>Changing stock values </li></ul>
  17. 19. >> C H E C K P O I N T <ul><li>What is the purpose of a stock exchange? </li></ul>
  18. 20. STOCK SELECTION <ul><li>Stock information sources </li></ul><ul><li>Economic factors </li></ul><ul><ul><li>Inflation </li></ul></ul><ul><ul><li>Interest rates </li></ul></ul><ul><ul><li>Consumer spending </li></ul></ul><ul><ul><li>Employment </li></ul></ul><ul><li>Company factors </li></ul>
  19. 21. FOUR-STEP PROCESS FOR DECIDING STOCK PURCHASES <ul><li>1. Observe and analyze economic and social trends. </li></ul><ul><li>2. Determine industries that will be affected. </li></ul><ul><li>3. Identify companies in those industries. </li></ul><ul><li>4. Decide whether to buy, sell, or hold the stock of those companies. </li></ul>
  20. 22. >> C H E C K P O I N T <ul><li>How do various economic factors affect stock prices? </li></ul>
  21. 23. LESSON 19-3 Bonds and Mutual Funds <ul><li>Goals </li></ul><ul><li>List types of government bonds. </li></ul><ul><li>Describe features of corporate bonds. </li></ul><ul><li>Describe various types of mutual funds. </li></ul>
  22. 24. Key Terms <ul><li>municipal bond </li></ul><ul><li>corporate bond </li></ul><ul><li>mutual fund </li></ul>
  23. 25. GOVERNMENT BONDS <ul><li>Municipal bonds </li></ul><ul><li>U.S. savings bonds </li></ul><ul><li>Other federal securities </li></ul><ul><ul><li>Federal notes (T-notes) </li></ul></ul><ul><ul><li>Treasury bills (T-bills) </li></ul></ul><ul><ul><li>Treasury bonds (T-bonds) </li></ul></ul>
  24. 26. >> C H E C K P O I N T <ul><li>List the types of bonds issued by the federal government of the United States. </li></ul>
  25. 27. CORPORATE BONDS <ul><li>Bond components </li></ul><ul><li>Bond values </li></ul>
  26. 28. >> C H E C K P O I N T <ul><li>What affects the value of a bond? </li></ul>
  27. 29. MUTUAL FUNDS <ul><li>A mutual fund is an investment fund set up and managed by companies that receive money from many investors. </li></ul>
  28. 30. TYPES OF MUTUAL FUNDS <ul><li>Aggressive-growth stock funds </li></ul><ul><li>Income funds </li></ul><ul><li>International funds </li></ul><ul><li>Sector funds </li></ul><ul><li>Bond funds </li></ul><ul><li>Balanced funds </li></ul>
  29. 31. MUTUAL FUND VALUES <ul><li>Shares of the mutual fund </li></ul><ul><li>Value of each share </li></ul><ul><li>Net asset value (NAV) </li></ul><ul><li>Operating expenses </li></ul><ul><li>Earnings </li></ul>
  30. 32. >> C H E C K P O I N T <ul><li>What are the main types of mutual funds? </li></ul>
  31. 33. LESSON 19-4 Real Estate Investments <ul><li>Goals </li></ul><ul><li>Describe home buying activities. </li></ul><ul><li>Explain the benefits of home ownership. </li></ul><ul><li>Discuss the costs of home ownership. </li></ul>
  32. 34. Key Terms <ul><li>real estate </li></ul><ul><li>mortgage </li></ul><ul><li>equity </li></ul><ul><li>assessed value </li></ul>
  33. 35. SELECTING HOUSING <ul><li>Renting your residence </li></ul><ul><li>Owning a mobile home </li></ul><ul><li>Buying a home </li></ul><ul><li>Services of real estate agents </li></ul><ul><li>Other real estate professionals </li></ul><ul><li>Buying a condominium </li></ul>
  34. 36. >> C H E C K P O I N T <ul><li>What are four available housing alternatives? </li></ul>
  35. 37. BENEFITS OF HOME OWNERSHIP <ul><li>Tax benefits </li></ul><ul><li>Increased equity </li></ul><ul><li>Pride of ownership </li></ul>
  36. 38. >> C H E C K P O I N T <ul><li>What are the main benefits of home ownership? </li></ul>
  37. 39. COSTS OF HOME OWNERSHIP <ul><li>Property taxes </li></ul><ul><li>Interest payments </li></ul><ul><li>Property insurance </li></ul><ul><li>Maintenance </li></ul>
  38. 40. >> C H E C K P O I N T <ul><li>What are common costs of home ownership? </li></ul>
  39. 41. LESSON 19-5 Other Investments <ul><li>Goals </li></ul><ul><li>Discuss types of commodity investments. </li></ul><ul><li>Explain the use of collectibles as an investment. </li></ul>
  40. 42. Key Terms <ul><li>commodities </li></ul><ul><li>futures contract </li></ul><ul><li>collectibles </li></ul>
  41. 43. COMMODITIES AND FUTURES <ul><li>Commodity exchanges </li></ul><ul><li>Agricultural commodities </li></ul><ul><li>Gold, silver, and precious metals </li></ul><ul><li>Currency and financial instruments </li></ul>
  42. 44. >> C H E C K P O I N T <ul><li>What types of commodities are commonly used with futures contracts? </li></ul>
  43. 45. COLLECTIBLES <ul><li>Types of collectibles </li></ul><ul><li>Collectible values </li></ul>
  44. 46. >> C H E C K P O I N T <ul><li>What are common types of collectibles? </li></ul>