Playing The Stock Market What is the Stock Market A public entity for the trading of company stock at an agreed price One of the most important places for corporations to raise money Corporation Publicly owned business which has multiple levels of hierarchy ID: 782536
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Slide1
Tell Me About It…
What do we know about the stock market?
Slide2Playing The Stock Market
Slide3What is the Stock Market
“A public entity for the trading of company stock at an agreed price”
One of the most important places for corporations to raise money
Corporation- Publicly owned business which has multiple levels of hierarchy
Slide4Corporate Makeup
Shareholders
Board of Directors
CEO/President
VPs/Regional Directors
Everyday Employees
Slide5Commodities
Success of the SM at any given time is dependant on what the public believes are commodities at that time
Commodities
Something that is in high demand
Slide6Commodities
Slide7Irrational Behavior
Unlike saving your money in a bank, investing in the stock market comes with substantial risk
Stock prices have, on many occasions, taken sizeable losses
Crash!
1929, 1973, 1992, 2001 (among others)
Slide8Market Regulation
Securities and Exchange Commission
Government created organization that watches for illegal activities in the market
Inflicts penalties on guilty parties (corporation or individual)
The goal is to make the SM a fair place of business
Slide9Transparency
All aspects of a publicly traded corporation has to be made available to the public
Leadership changes
Philosophical changes
Earnings
Earnings usually are reported quarterly (4 times a year) to the public
How much did the company make or lose over a certain time period
Slide10Investing In Stock
Regular trading
Purchasing the stock at the list price, paying a commission, and earning or losing money based on the profit of the company
What to look for?
What does the corporation do/ bring to society?
Is that in high demand?
What is the corporate makeup/ does it have strong leadership?
Slide11Regular Trading
Disney Corporation
September 1
st
: 1 share = $20
September 1
st: Purchase 100 shares ($2000)October 1
st: 1 Share = $30October 1
st
: Sell 100 Shares ($3000)
October 1st: 1 Share = $10October 1st: Sell 100 Shares ($1000)
Slide12Identifying Trends
and
Strategies
Buying stock = wanting the stock to increase
Selling Short = wanting the stock to decrease
Stop Order = setting a price and when the stock hits that price it will automatically sell your shares
Slide13Reading a Stock Quote
Current Price & Daily Change
Daily/Yearly
Range
Volume and Charts
Slide14Option Trading
Allows you to “play” a stock that you normally wouldn’t be able to afford
The play that a stock will “strike” a certain price by a certain time
Call Stock = Increase in stock price
Put Stock = Decrease in stock price
Slide15Slide16Slide17For Next Class
Identify 5 things that you believe that commodities in today’s economy
Research and list 3 companies that you may want to invest in
Slide18Answer the following
What is a commodity? Name 3 commodities in today’s society.
Briefly explain the makeup of a corporation. Make an argument how the least powerful people in a corporation may be the most important.