Learn even more about this topic with the Encyclopedia of Personal Finance™
? Average. An equation that
combines the value of a number of stocks into an arithmetic mean in an attempt
to gauge the general direction of the market. The Dow Jones Industrial Average
is a famous example.
? Growth stocks. Stocks that are thought to
have the potential to grow in value more rapidly than the market as a whole.
? Income stocks. Stocks that have a record
of paying dividends regularly.
? Index. Another means to determine market
trends, but this time in relation to a base market value. The AMEX Composite
Index is an example.
? Market value. The value of a stock on the
open market, based on the value of the company's assets and investor
expectations of the stock's performance.
? Par. The face value of a share of stock,
as assigned by the issuing company.
? Volatility. The tendency of a stock's
value to change up or down. A stock's volatility is a prime consideration in any
Let?s review what we have learned.