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JA Take Stock In Your Future Session Two JA Take Stock In Your Future Session Two

Objectives • • • Read online stock tickers and tables Understand what factors are Objectives • • • Read online stock tickers and tables Understand what factors are involved when you’ve decided the type of investment that is best for you Understand what information needs to be analyzed to help decide which investments are right for you Define the difference and benefits of buy-and-hold investing and active trading Play a mini simulation of the Stock Market Challenge

Review • What is the difference between sole proprietorship, partnership, and corporation? • Why Review • What is the difference between sole proprietorship, partnership, and corporation? • Why would a private corporation choose to become public? • What is one way the stock price is determined? • What are dividends? • What is a shareholder? • How could you reduce risk if you are an investor? • Why might you want to increase risk? • How do you buy stock? Explain where/when/why. • What is a bull market? Bear market?

Activity • Big Burger Company only has stores in Colorado. • They want to Activity • Big Burger Company only has stores in Colorado. • They want to expand to Arizona and build at least five new locations. It will take $1 million to build each new location, so they issue $5 million in stock. • Each share of stock will be sold at a starting price of $100, so the company will issue 50, 000 shares. • The company has done research that indicates their new stores in AZ will be successful since those demographics match those of their current customers in CO. What additional information would you like before you choose to invest your money?

Stock Tickers and Tables Stock Tickers and Tables

 Stock Tables – A stock table contains basic information on the changes in Stock Tables – A stock table contains basic information on the changes in the stock market for a day – Information in a stock table includes: • Abbreviation of company name (example: Allstate = ALL) • Year high and low for that particular stock • How many much trade volume has changed hands for that company within the day • The highest and lowest prices paid for that stock during the day • The day’s closing price and its difference from yesterday’s closing price • Dividend on the stock

How to Read Stock Tables How to Read Stock Tables

Apple (sample) Apple (sample)

Apple vs. Google Apple vs. Google

The JA Stock Market Challenge The JA Stock Market Challenge

Active & Buy-and-Hold Trading Frequent trading - actively buying and selling The investor watches Active & Buy-and-Hold Trading Frequent trading - actively buying and selling The investor watches the market trends and makes constant, fast decisions about what and when to buy and sell. When is this a good strategy? Buy-and-hold trading The investor purchases stocks or funds but does not constantly monitor their progress. When is this a good strategy?

Mini Stock Simulation Game Axel Group (AXG) Price $10. 00 East. Coast Paper Corp. Mini Stock Simulation Game Axel Group (AXG) Price $10. 00 East. Coast Paper Corp. (ECP) Price $5. 00 Johnson Gold Resources (JGR) Price $2. 00 Theal Corp (TLC) Price $35. 00 Zappa Foods Co. (ZPC) Price $25. 00 LET THE TRADING BEGIN: CHOOSE WHERE TO SPEND YOUR $10 K

Day 30 Axel Group (AXG) Price $25. 00 East. Coast Paper Corp. (ECP) Price Day 30 Axel Group (AXG) Price $25. 00 East. Coast Paper Corp. (ECP) Price $3. 00 Johnson Gold Resources (JGR) Price $12. 00 Theal Corp (TLC) Price $37. 00 Zappa Foods Co. (ZPC) Price $10. 00

Day 60 Axel Group (AXG) Price $15. 00 East. Coast Paper Corp. (ECP) Price Day 60 Axel Group (AXG) Price $15. 00 East. Coast Paper Corp. (ECP) Price $5. 00 Johnson Gold Resources (JGR) Price $25. 00 Theal Corp (TLC) Price $40. 00 Zappa Foods Co. (ZPC) Price $5. 00

What will you do with $500, 000? • • • 60 seconds = 1 What will you do with $500, 000? • • • 60 seconds = 1 day Press releases and hot tips throughout Floor traders will help you buy and sell There are 26 different stocks! Your team must submit stock pick info: • • Stock Name Symbol Number of shares Total Dollars Invested in this Stock

Summary of Basic Terms Summary of Basic Terms

 Terms to Know – Bear Market: A bear market occurs when more people Terms to Know – Bear Market: A bear market occurs when more people want to sell stocks than buy them, causing stock prices to fall. – Brokerage Commission: Brokers (agents for potential buyers and sellers) charge a fee for each transaction they make on your behalf. You are charged this fee in addition to the price of the stock. – Bull Market: A bull market occurs when more people want to buy stocks than sell them, causing stock prices to rise.

Terms to Know (cont’d) –Common Stock: Stock that may pay dividends as determined by Terms to Know (cont’d) –Common Stock: Stock that may pay dividends as determined by the corporation’s board of directors. Common stock holders can vote for members of the board. –Dividend: The part of corporate profits distributed to stockholders (generally dispersed quarterly. ) –Dow Jones Industrial Average: While not a true average, it is a price weighted average, not a measure of the average price. It is an index that shows how the select top 30 publically owned companies have traded during a standard trading session. Broad market averages designed to tell you how companies traded on the stock market are doing in general. –Equity: Ownership in a company.

Terms to Know (cont’d) – Market/Marketplace: A place where buyers and sellers meet. – Terms to Know (cont’d) – Market/Marketplace: A place where buyers and sellers meet. – Preferred Stock: As opposed to “common stock, ” preferred stock has certain privileges. Owners are the first to receive dividends and the first to receive a share of the assets if the corporation is liquidated. The dividend is a constant amount. – Prospectus: a statement of financial information that contains details on its objectives, investment, strategies, risks, performances, distribution policy, fees and expenses and fund management.

Terms to Know (cont’d) – Retained Earnings: Profit (minus taxes), not paid as dividends Terms to Know (cont’d) – Retained Earnings: Profit (minus taxes), not paid as dividends but instead retained by the business to be reinvested in the business. – Securities: Stocks, bonds or other investment vehicles. – Stock: Shares in the ownership of a corporation. – Stock Exchange: An organized marketplace where securities are bought and sold. – Stock Broker: A person in a firm who is authorized to trade at the exchange. – Stock Market: 1) Where buyers and sellers of stock meet; 2) an arrangement, rather than a physical place, that allows people to exchange stock. – Stockholder: The owner of stock in a corporation.