Saving is for everyone, investing is for the wealthy

Your money is insured when investing, it is not in savings

Investing has a guaranteed return, savings does not

Saving is for emergencies & goals, investing is for long-term wealth

Your money grows faster when it is compounded

You earn interest on your interest

Fees for compound interest are greater than simple interest

Compound interest is hard to calculate, so fewer use it

Stock

Mutual Fund

Bond

Money Market Account

Higher risk indicates higher return

Higher risk indicates lower return

Lower risk indicates higher return

No relationship exists between risk and return

New York Stock Exchange

Dow Jones Industrial Average

S&P 500

Nasdaq

A capital gain

Interest

Dividends

Holding the stock at least 3 years

Rise

Fall

Stay the same

Principal

Coupon

Par Value

Maturity Date

S&P

Experian

Moody's

Fitch

2%

3%

30%

70%

IPOs occur when a private company becomes publicly traded

All companies file an IPO

The value of an IPO can be difficult to measure

When an IPO occurs, a company raises money to grow the business

AMF typically carry lower costs (expense ratios) than IF

The goal of an IF is to earn a higher return than the market

AMF try to outperform their benchmark & peer group average

IF try to track performance of a particular index

Discount/Online Brokers

Discount Brokers with Assistance

Full-Service Brokers

Money Managers

It limits investment choice

It's a good predictor on rate of return

It increases risk and return

It decreases risk

Well-balanced portfolio of different stock classifications

Dividing among different asset categories based on risk

Dividing among different asset categories based on time

Chance your investment won't be worth as much in the future

Compound interest

Diversification

Dollar cost averaging

Inflation

Have a diversified portfolio

Have an investment with low fees

Don't have to monitor as closely as an actively managed account

You want to "beat the market" with your ROI

Roth IRA

Traditional IRA

You take less risk when you are young, so money will be safe

You have more time for your money to compound

Investing is an easy way to make quick money

Fees on investments are cheaper when you are younger

True

False