The Stock Market Game

1
The Stock Market Game

• Investing with Confidence

2
What is a stock?

• A share of stock is a unit of ownership in a
  corporation or mutual fund, or an interest in a
  general or limited partnership. Though the word
  is sometimes used interchangeably with the word
  stock, you actually own shares of stock.

3
Shares

• A Company goes to the bank to get more money to
  grow the company.
  
• The Bank will take the company and divide it up
  into little pieces to see if people will buy
  them.
  
• Investors (you and me) get to own a small part of
  that company
  
• When the company makes money we make money

4
I paid how much for that stock?
5
Price per share

• Stock Markets are open from 1000 to 400, Monday
  through Friday.
  
• Shares of companies are traded (bought and sold)
  during this time.
  
• The trading makes the price go up and down

6
Stock Market Game

• Know your company
• What sector (industry) is it in?
• What is the Market Capitalization?
• What is the Price to Earnings Ratio (P/E)?
• What are the long term trends?
• What do I like about it?

7
Sector

• 1. An area of the economy in which businesses
  share the same or a related product or service.
  For example
  
• Technology
• Apple, Microsoft, Dell, Intel, IBM
• Retail
• Ralph Lauren, JC Penny, Abercrombie Fitch,
  Wal-mart
  
• Entertainment
• Disney, CBS, Nickelodeon, Discovery Channel

8
Price to Earnings

• A valuation ratio of a company's current share
  price compared to its per-share earnings.
  
• Click to learn more
• http//www.investopedia.com/university/peratio/per
  atio2.asp

9
Market Capitalization

• The total dollar market value of all of a
  company's outstanding shares. Market
  capitalization is calculated by multiplying a
  company's shares outstanding by the current
  market price of one share. The investment
  community uses this figure to determining a
  company's size, as opposed to sales or total
  asset figures.

10
Market Capitalization 2

• If a company has 35 million shares outstanding,
  each with a market value of 100, the company's
  market capitalization is 3.5 billion (35,000,000
  x 100 per share
• Large Cap 10 billion plus
• Mid Cap 2 billion to 10 billion
• Small Cap Less than 2 billion

11
Research

• Spend at least an hour per week, per stock,
  reading about your company.
  
• The Street.com
• Yahoo Finance
• Motley Fool
• Bloomberg.com
• CBS Marketwatch