D775 WGU Section 1
Study online at https://quizlet.com/_gy4zah
1. Personal Finance: Managing individual or household financial activities
2. Public Finance: Managing a government's revenues, expenditures, and debt
3. Business Finance: Managing a company's financial activities and strategies
4. Capital Appreciation: when a stock is bought at a lower price than what it is sold at.
5. Preferred stocks: provide more stability with fixed dividends and higher priority in asset claims but usually
lack voting rights, offering less control over corporate governance.
6. Common stocks: offer the potential for higher returns and voting rights but come with greater risk due to
their lower priority in claims on assets.
7. : Common stock represents ownership with voting rights and variable dividloans that various entities (like businesses,
governments, or individuals) issue, or sell, to raise capital.ends,
8. Bonds: loans that various entities (like businesses, governments, or individuals) issue, or sell, to raise capital.
9. maturity: a specific date when the last coupon is due along with the original face value of the bond
10. junk bonds/ speculative bonds: high-risk, and investors hope to earn a relatively higher return due
to that risk.
11. Corporate Bonds: Issued by firms to finance operations, expansions, and other business activities. Typically
carries higher yields due to higher risk
12. public bonds:: Issued by government groups. There are two main kinds municipal and treasury.
13. Municipal Bonds / munis: Issued by states or local governments and municipalities fund public
projects, like infrastructure such as public roads, hospitals, parks, and fire departments.
14. Treasury bonds / treasuries: When firms have extra cash sitting in their account- short-term, non-risky
investments for the cash.
15. How do companies raise capital through debt and equity financing?: Companies
can issue bonds (debt financing), which must be repaid with interest, or sell stock (equity financing), which gives
ownership to investors but does not require repayment.
16. Financial derivatives: They derive their value from the performance of underlying assets, indexes, or
rates.
17. Options: financial contracts that give the buyer the right, but not the obligation, to buy or sell an asset at a
predetermined price, known as the "strike price," before a specified date
18. Futures: standardized contracts obligating the buyer to purchase or the seller to sell an asset at a predetermined
price on a specified future date.
19. Mutual Funds: typically open-end investment companies that issue shares to the public and are priced daily
based on their net asset value (NAV
1/5
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20. Exchange-traded funds: trade on stock exchanges like individual stocks and can be bought and sold
throughout the trading day
21. Hedge Funds: private investment partnerships for accredited investors that employ diverse strategies to
generate high returns, often with higher risk
22. Pension Funds: large pools of capital collected from employees for retirement savings, managed to ensure
growth and sustainability of the fund.
23. Public Markets: buying and selling of securities, such as stocks and bonds, on organized exchanges where
the general public can participate
24. Private Markets: transactions of equity, debt, or other securities that are not publicly traded, typically
involving institutional investors, private equity firms, venture capitalists, and accredited individual investors
25. NYSE: known for its strictest listing requirements and auction-based trading,
26. NASDAQ: recognized for its electronic trading platform and focus on technology stocks.
27. Regulators: oversee these exchanges to maintain fair, efficient, and transparent market
28. Securities and Exchange Commission (SEC: regulates securities markets, enforcing laws to
protect investors and maintain orderly functioning
29. Commodity Futures Trading Commission (CFTC): Oversees futures and options markets,
ensuring they operate free from fraud and manipulation.
30. IPO: when a company sells shares to the public for the first time.
31. Why use IPO: raise capital, expand operations, and increase their market presence.
32. Primary Markets: where new securities are issued and sold for the first time.
33. Secondary Markets: where existing securities are traded among investors. Provides liquidity, enabling
investors to buy and sell securities without the need for the issuing firm's involvement. NYSE and NASDAQ
34. Dealer Markets: transactions are facilitated by market makers, or dealers, who buy and sell securities for
their own accounts; NASDAQ
35. Auction Market: Centralized mechanism where all buy and sell orders for a security are aggregated, and
the price is determined by the highest price a buyer is willing to pay and the lowest price a seller is willing to accept;
NYSE
36. Depository Institutions: such as commercial banks, savings and loan associations, and credit unions,
accept deposits from people and businesses and provide loans
37. Investment Institutions: including investment banks, mutual funds, and hedge funds, help individuals
and organizations invest in securities and other assets.
2/5
Study online at https://quizlet.com/_gy4zah
1. Personal Finance: Managing individual or household financial activities
2. Public Finance: Managing a government's revenues, expenditures, and debt
3. Business Finance: Managing a company's financial activities and strategies
4. Capital Appreciation: when a stock is bought at a lower price than what it is sold at.
5. Preferred stocks: provide more stability with fixed dividends and higher priority in asset claims but usually
lack voting rights, offering less control over corporate governance.
6. Common stocks: offer the potential for higher returns and voting rights but come with greater risk due to
their lower priority in claims on assets.
7. : Common stock represents ownership with voting rights and variable dividloans that various entities (like businesses,
governments, or individuals) issue, or sell, to raise capital.ends,
8. Bonds: loans that various entities (like businesses, governments, or individuals) issue, or sell, to raise capital.
9. maturity: a specific date when the last coupon is due along with the original face value of the bond
10. junk bonds/ speculative bonds: high-risk, and investors hope to earn a relatively higher return due
to that risk.
11. Corporate Bonds: Issued by firms to finance operations, expansions, and other business activities. Typically
carries higher yields due to higher risk
12. public bonds:: Issued by government groups. There are two main kinds municipal and treasury.
13. Municipal Bonds / munis: Issued by states or local governments and municipalities fund public
projects, like infrastructure such as public roads, hospitals, parks, and fire departments.
14. Treasury bonds / treasuries: When firms have extra cash sitting in their account- short-term, non-risky
investments for the cash.
15. How do companies raise capital through debt and equity financing?: Companies
can issue bonds (debt financing), which must be repaid with interest, or sell stock (equity financing), which gives
ownership to investors but does not require repayment.
16. Financial derivatives: They derive their value from the performance of underlying assets, indexes, or
rates.
17. Options: financial contracts that give the buyer the right, but not the obligation, to buy or sell an asset at a
predetermined price, known as the "strike price," before a specified date
18. Futures: standardized contracts obligating the buyer to purchase or the seller to sell an asset at a predetermined
price on a specified future date.
19. Mutual Funds: typically open-end investment companies that issue shares to the public and are priced daily
based on their net asset value (NAV
1/5
, D775 WGU Section 1
Study online at https://quizlet.com/_gy4zah
20. Exchange-traded funds: trade on stock exchanges like individual stocks and can be bought and sold
throughout the trading day
21. Hedge Funds: private investment partnerships for accredited investors that employ diverse strategies to
generate high returns, often with higher risk
22. Pension Funds: large pools of capital collected from employees for retirement savings, managed to ensure
growth and sustainability of the fund.
23. Public Markets: buying and selling of securities, such as stocks and bonds, on organized exchanges where
the general public can participate
24. Private Markets: transactions of equity, debt, or other securities that are not publicly traded, typically
involving institutional investors, private equity firms, venture capitalists, and accredited individual investors
25. NYSE: known for its strictest listing requirements and auction-based trading,
26. NASDAQ: recognized for its electronic trading platform and focus on technology stocks.
27. Regulators: oversee these exchanges to maintain fair, efficient, and transparent market
28. Securities and Exchange Commission (SEC: regulates securities markets, enforcing laws to
protect investors and maintain orderly functioning
29. Commodity Futures Trading Commission (CFTC): Oversees futures and options markets,
ensuring they operate free from fraud and manipulation.
30. IPO: when a company sells shares to the public for the first time.
31. Why use IPO: raise capital, expand operations, and increase their market presence.
32. Primary Markets: where new securities are issued and sold for the first time.
33. Secondary Markets: where existing securities are traded among investors. Provides liquidity, enabling
investors to buy and sell securities without the need for the issuing firm's involvement. NYSE and NASDAQ
34. Dealer Markets: transactions are facilitated by market makers, or dealers, who buy and sell securities for
their own accounts; NASDAQ
35. Auction Market: Centralized mechanism where all buy and sell orders for a security are aggregated, and
the price is determined by the highest price a buyer is willing to pay and the lowest price a seller is willing to accept;
NYSE
36. Depository Institutions: such as commercial banks, savings and loan associations, and credit unions,
accept deposits from people and businesses and provide loans
37. Investment Institutions: including investment banks, mutual funds, and hedge funds, help individuals
and organizations invest in securities and other assets.
2/5
