invalid compressor name displayable data: 65
THE INTELLIGENT INVESTOR BY BENJAMIN GRAHAMThe Interpretation of
Financial Statements by Benjamin Graham and Spencer B.
Meredith.Security Analysisby Benjamin Graham and David Dodd. This
book is considered thebible of investingand will tell you how to
analyze corporate finances thoroughly.
STOCKS VS BONDSStocksandbondsare financial instruments for
investors to obtain a return and for companies to raise capital.
Put very simply, stocks offer an ownership stake in the company and
bonds are akin to loans made to the company.Stocks of a company are
offered at the time of an IPO (Initial Public Offering) or
laterequitysales. The company offers investors an ownership stake
by selling stocks. Stocks can be eithercommon stock or preferred
stock. Preferred stock is further divided intoparticipating and
non-participating preferred stock.With the equity that stocks offer
comes greater risk. The value of stocks corresponds to the value of
the company and therefore, stock price fluctuates depending upon
how the market values the company.In contrast, bonds are loans
offered at a fixed interest rate. When a company believes that it
can raise capital cheaper by borrowing money from banks,
institutional investors or individuals, they may choose to offer
interest-paying corporate bonds. With bonds, an investor is
promised a fixed return. While bonds are "safer" than stocks
because of lower volatility, it should be noted that there is
always a chance that company will be unable to repay bond-holders.
In that sense, bonds are not "risk-free".
STOCKS VS SHARES"stock" is a general term used to describe the
ownership certificates of any company, in general, and "shares"
refers to a the ownership certificates of a particular company. So,
if investors say they own stocks, they are generally referring to
their overall ownership in one or more companies. Technically, if
someone says that they own shares - the question then becomes -
shares in what company?
Bottom line, stocks and shares are the same thing.'Retail
Investor'
Individual investors who buy and sell securities for their
personal account, and not for another company or organization.
'Earnings Per Share - EPS'
The portion of a company's profit allocated to each outstanding
share of common stock. Earnings per share serves as an indicator of
a company's profitability.
Calculated as:
When calculating, it is more accurate to use a weighted average
number of shares outstanding over the reporting term,
Definition of 'Inflation'The rate at which the general level of
prices for goods and services is rising, and, subsequently,
purchasing power is falling. Central banks attempt to stop severe
inflation, along with severe deflation, in an attempt to keep the
excessive growth of prices to a minimum.As inflation rises, every
dollar will buy a smaller percentage of a good. For example, if the
inflation rate is 2%, then a $1 pack of gum will cost $1.02 in a
year.
mp4creator 1.4.4
