How to make money

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How to make money

  1. 1. The Stock Market Edition Mr. Elsesser Period 3
  2. 2. Bear Market VS Bull Market <ul><li>A financial market of a group of securities in which prices are rising or are expected to rise. </li></ul><ul><li>A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment to be self-sustaining . </li></ul>
  3. 3. What is a stock and why do companies have them? <ul><li>A stock is a share in the ownership of a company. </li></ul><ul><li>Companies have stocks because when they want to grow, stocks help to raise funds and pay for ongoing business activities. </li></ul>
  4. 4. What is the Stock Market? <ul><li>A general term referring to the organized trading of securities in the various market exchanges and the over the counter (OTC) market. </li></ul><ul><li>New York Stock Exchange </li></ul><ul><li>NASDAQ (National Association of Security Dealers Automated Quotations) </li></ul><ul><li>London Stock Exchange </li></ul>
  5. 5. How can I make money using stocks? <ul><li>Basic Ways </li></ul><ul><ul><li>Buying </li></ul></ul><ul><ul><li>Selling </li></ul></ul><ul><ul><li>Dividends </li></ul></ul><ul><li>Advanced Ways </li></ul><ul><ul><li>Buying on Margin </li></ul></ul><ul><ul><li>Selling Short </li></ul></ul><ul><ul><li>Buying Options </li></ul></ul>
  6. 6. Buying, Selling, and Dividends <ul><li>Buy Low , Sell High </li></ul><ul><li>If you have the money, it is easier to do it this way, however, you need some background in the stock market. </li></ul><ul><li>Dividends- Payments made by corporations to shareholders (distribution of the profits) as either money or more shares. </li></ul>
  7. 7. Buying on Margin <ul><li>A risky short-term strategy </li></ul><ul><li>The investor borrows money from a broker to make an investment. </li></ul><ul><li>The buyer believes the stock price will rise and is trying to maximize profits by investing more money in the stock. </li></ul>
  8. 8. Selling Short <ul><li>A risky- short term strategy </li></ul><ul><li>When you feel bearish and believe the price will decline. </li></ul><ul><li>Selling a stock with the hope of buying it back at a lower price. (sell high, buy low) </li></ul><ul><li>Short selling involves borrowing stock (usually from the broker) to sell short and using margin to finance the borrowing. </li></ul>
  9. 9. What are Options…Calls/Puts <ul><li>Call- the option to buy the underlying stock at a predetermined price by a predetermined date. </li></ul><ul><li>Put- the option to sell the underlying stock at a predetermined strike price until a fixed expiry date. </li></ul>
  10. 10. Benefits of Options <ul><li>Protect stock holdings from a decline in market price. </li></ul><ul><li>Each contract is worth 100 shares. </li></ul><ul><li>Prepare to buy stock at a lower price. </li></ul><ul><li>Position yourself for a big market move - even when you don't know which way prices will move. </li></ul><ul><li>Benefit from a stock price's rise or fall without incurring the cost of buying the stock outright. </li></ul>
  11. 11. Youtube Video

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