Selected Core Resources


Sponsored by the BRASS Education Committee

Investment and Finance

Maintained by
Shikha Sharma
University of Connecticut
shikha.sharma@uconn.edu


Scope | Important Terms | Frequently Asked Questions


   


Finance and investment are business disciplines concerned with the ways in which individuals and institutions can use money to make money. How values are determined and the related decision-making processes are also covered and specific areas include stocks, bonds annuities and trusts. For a short list of investment and finance web sites, see the Best of the Best Business Web Sites (Free Websites): Financial Markets and Investments.


   
All definitions are taken from Barron's Finance & Investment Handbook
by John Downes and Jordan Elliot Goodman,
Barron's Educational Series, Hauppauge, New York, 1998.

Important Terms
All definitions are taken from Barron's Finance & Investment Handbook by John Downes and Jordan Elliot Goodman, Barron's Educational Series, Hauppauge, New York, 1998.

American Stock Exchange (AMEX) - primary marketplace in the U.S. for equities, bonds, options, and derivative securities. Located at 86 Trinity place in lower Manhattan, AMEX was known as the Curb Exchange until 1921. AMEX trades more than 900 issues on its primary list. The two main indices tracking AMEX stocks are the AMEX Composite Index and the AMEX Major Market Index.

Annuity - a contract sold by life insurance companies that guarantees a fixed or variable payment to the annuitant at some future time, usually retirement.

Bear Market - prolonged period of falling prices. A bear market in stocks is usually brought on by the anticipation of declining economic activity, and a bear market in bonds is caused by rising interest rates.

Bond - any interest bearing or discounted government or corporate security that obligates the issuer to pay the bondholder a specified sum of money, usually at specific intervals, and to repay the principle amount of the loan at maturity. Bondholders have an IOU from the issuer, but no corporate ownership privileges , as stockholders do.

Bull Market - prolonged rise in the prices of stocks, bonds, or commodities.

Capital Stock - stock authorized by a company's charter. The number and value of issued shares are normally shown, together with the number of shares authorized, in the capital accounts shown in the balance sheet.

Commodities - bulk goods such as grains, metals, and foods traded on a commodities exchange.

Common Stock - units of ownership of a public corporation. Owners are typically entitled to vote on the selection of directors and other important matters as well as receive dividends from their holdings.

Dividend - distribution of earnings to shareholders, prorated by class of security and paid in the form of money, stock, scrip, or rarely company products or property.

Equity - ownership interest possessed by shareholders in a corporation - stock as opposed to bonds.

Mutual Fund - fund operated by an investment company that raises money from shareholders and invests it in stocks, bonds, options, futures, currencies, or money market securities.

NASDAQ Stock Market - the first electronic stock market listing nearly 5,500 companies, operated by the NASDAG Stock Market Inc., a wholly owned subsidiary of the National Association of Securities Dealers.

New York Stock Exchange (NYSE) - founded in 1792, it is the oldest and largest stock exchange in the U.S. , located at 11 Wall Street in New York City; also known as the Big Board and The Exchange. More than 3,000 firms are on the NYSE , representing large firms that meet the exchange's stringent listing
requirements.

Option - securities transaction agreement tied to stocks, commodities, or stock indexes. Options are traded on many exchanges.

Preferred Stock - class of capital stock that pays dividends at a specified rate and that has preference over common stock in the payment of dividends and the liquidation of assets.

Stock - ownership of a corporation represented by shares that are a claim on the corporation's earnings and assets.

Stock Exchange - organized marketplace in which stocks, common stock, and bonds are traded by the members of the exchange, acting both as agents (brokers) and as principals (dealers or traders).

Ticker - system that produces a running report of the trading activity on the stock exchanges, called the ticker tape.

Ticker Symbol - letters that identify a security for trading purposes on the consolidated tape, such as XON for Exxon Corporation.

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    I am a beginning investor and I need to find some places where I can get some really practical advice about getting started. Can you recommend some resources where I can get hands on tips about some of the opportunities and pitfalls of investing on my own?

The Internet is a great resource for people to gather information about investing. Advice and tips for beginning investors can be found all across the Internet. A few of the better ones include:
 
Basics of Investing: http://money.cnn.com/pf/101/lessons/4/

A site set up by Money magazine to provide advice and guidance for individuals that are seeking to invest money. It covers stocks, bonds, mutual funds, and other investment basics. Geared towards new investors this site is an excellent How To for those who are getting started.
 
Financial Web Portal: http://www.finweb.com/investing/

Financial Web Portal provides a wealth of information on basics of successful investing and advice on how to make investment decisions based on one’s own financial situation and personality. There’s also good information on investing in mutual funds, stocks and bonds, real estate, and commodities.
 
Investor Education and Assistance: http://www.sec.gov/investor.shtml

A consumer site established by the Securities and Exchange Commission that advocates awareness and rights for the individual investor. There are links to a number of publications on savings and investing. This site also summarizes SEC enforcement activities and provides current fraud alerts.
 
National Association of Investors Corporation (NAIC): http://www.better-investing.org

This not for profit site is designed to help beginning investors wade through the investment jungle. It provides hands on advice and tips about investing principles and buying stocks. This association has been an investment education group for more than 50 years.

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    Where can I go to get a quick quote and current analysis of a particular stock?

 The places where one can go to get current stock information is almost limitless. A few of the possible places include:

BIGCHARTS: http://www.bigcharts.com

BIGCHARTS provides instant quoting for all currently traded stocks. This site can also provide daily and historical charting for designated stocks. Industry analysis, intraday stock screeners, and daily market news are also provided on this site. One of the largest and most respected free research sites on the Internet.

Local Newspapers’ Business and Stock Pages (Any Town, USA)

Most local newspapers have a business section and publish a daily stock page. In many cases local papers will profile and analyze local companies that have a presence in national markets.

Motley Fool: http://www.fool.com

One of the largest and most popular investment sites on the Internet. This service provides instant stock quotes and other supporting services for investors.

NASDAQ Stock Exchange: http://www.nasdaq.com

The website for one of the major stock exchanges in the United States. This site offers instant stock quotes and quick research of companies on the NASDAQ ticker.

New York Stock Exchange: http://www.nyse.com

Another website for a major stock exchange in the United States. The site has a running ticker, as well as an instant stock quoting service. It has excellent profiles of member companies and institutions.

THESTREET: http://www.thestreet.com

An excellent combination of current stock tracking and market news from a number of investment sectors.

The Wall Street Journal: http://online.wsj.com/mdc/page/marketsdata.html

Perhaps the most respected daily newspaper in the financial world. The Money & Investing part of the paper has the most extensive stock and investment listings available. This section also has articles that give advice and tips for potential investors. The paper also profiles up and coming companies that might offer good stock purchasing opportunities for individuals.  

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    Where can I look to get more detailed information about a company's stock and the industry it belongs to?

A number of good sources are available that will profile individual stocks, dividend potential, and provide industry analysis. Some of these sources would include:

Mergent Dividend Record (New York: Mergent FIS).

Formerly Moody's this source is one of the best dividend sources available. It provides information on dividends, splits, mergers, and other earnings information for nearly 30,000 North American securities.

Mergent Handbook of Common Stocks (New York: Mergent FIS).

Another former Moody's product that profiles stock performance, trends, prices, and prospects for about 1,000 companies that trade on the New York Stock Exchange.

Standard & Poor's Industry Surveys (New York: McGraw Hill).

This source is available in a number of different formats (e.g. S&P NetAdvantage) and provides an excellent synopsis and analysis of a number of key industries. Important figures, past performance, trends, issues, and future prospects are profiled in considerable detail. S & P has long been a respected source for one stop industry information.

Standard & Poor’s Stock Reports (New York: McGraw Hill).

This source is also available in a number of different formats and profiles more than 10,000 publicly traded stocks.

U.S. Industry & Trade Outlook (New York: McGraw Hill).

This source provides excellent overviews of the industries that make up the U.S. economy. It identifies key statistics and profiles key companies across a number of different industries. The International Trade Administration is working on developing a Web version. For updates on their progress see: http://www.outlook.gov/. Last print version was published in 2000.

Value Line (New York: Value Line Publishing).

Value Line is available in a number of different formats, and contains overviews of different industries.

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    How can I get information on publicly traded companies?

A vast amount of information about public companies is available to potential investors. A few places to look might include:

EDGAR: http://www.sec.gov/edgar.shtml

EDGAR, the Electronic Data Gathering, Analysis, and Retrieval system of the Securities and Exchange Commission, contains all of the financial filings for over 15,000 publicly traded companies. This database includes things like 10k reports, 10q statements, and other financial reporting documents.

Hoovers' Online: http://www.hoovers.com

This source provides brief financial and sales profiles of nearly 10,000 companies.

Mergent Manuals: (New York: Mergent FIS).

Formerly the Moody's manuals which provide directory and financial information for nearly 25,000 companies. This set consists of a number of different manuals which include Industrial, International, Bank & Finance, Public Utility, and Transportation.

Standard & Poor's Corporation Records (New York: McGraw Hill).

This source is available in number of different formats, and it provides financial information for publicly traded companies.

Yahoo!Finance: http://finance.yahoo.com

Find the latest company news and company profiles, excellent charts, key statistics, financial statements, current and historical stock quotes going back to 1986, top ten competitors and SEC filings. Also, provides 51 broad industry research reports comparing the top 10 companies in each.

Value Line (New York: Value Line Publishing).

This source comes in a number of different formats, and is most famous for providing detailed one page investment analysis of public companies.

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    Where can I get information on bonds?

A number of good sources are available for researching bonds, and some of them would include:

Bonds Online: http://www.bonds-online.com

This site provides overviews of bond issues and links to news about the bond market.

Mergent Bond Record (New York: Mergent FIS).

Formerly Moody's this source profiles a number of current bond issues and charts their performance.

Standard & Poor's Bond Guide (New York: McGraw Hill).

This source comes in a number of different formats and provides a good overview of common bond issues.

The Securities Industry and Financial Markets Information: http://www.sifma.org/research/statistics/statistics.html

Provides access to historical and current data on issuance, rates, and average maturity for corporate and municipal bonds, and federally issued securities. Also, covers Moody’s Corporate Bond Yield Averages from 1996 to present.

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    I am thinking about setting up a mutual fund, where can I go to get information about mutual funds?

Mutual funds are a popular investment and savings device and a number of tools can provide information and analysis of different available funds.

Mutual Fund Investor’s Center: http://www.mfea.com/

Published by the Mutual Fund Education Alliance, the not-for-profit trade association of the no-load mutual fund industry, this resource is designed to serve as an important resource for investors who want to use mutual funds to reach their financial goals. Here, you'll find a large collection of mutual fund companies, website links, fund listings and exclusive planning, tracking and monitoring tools.

ICI Mutual Fund Connection: http://www.ici.org

A consumer orientated site that provides information about individual funds and practical advice on choosing between them. This site also tries to educate the public about investment companies and the world of mutual funds.

Morningstar Mutual Funds http://www.morningstar.com/Cover/Funds.html (Chicago: Morningstar).

This popular source is perhaps the most respected guide to mutual funds. Morningstar provides a detailed overview for nearly 2000 mutual funds selected from the top investment firms. Some free content is available on their website.
 

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    Where could I go to find magazine and newspaper articles about possible investment opportunities?

A number of places will allow you to search for articles that would talk about investment related issues. A few would include:

ABI/Inform (UMI: Proquest).

Perhaps the best and most complete index to the business literature. ABI covers about 1000 periodicals many of which are covered full-text. Both research orientated and popular business publications are included in the coverage. Finance and investment industry journals are extensively covered in this index.

Factiva (New York: Dow Jones & Reuters).

One of the best sources for investment trade news and information. Users have full-text access to numerous publications, including the Wall Street Journal and other newspapers as well as journals and newswires. Company and market information, including analyst reports, are part of the content as are charting tools and screening functions.

LexisNexis (Reed Elsevier Inc.)

LexisNexis is an excellent source for business trade literature as well as local and national newspaper coverage, including full-text access to the New York Times. The Industry and Trade news section covers the finance/investment industry very well.

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    What are some of the principle magazine, journal, and newspaper titles that would deal with finance/investment?

The number of available publications is almost limitless. Some of the more commonly available titles include:

Barron's (Chicopee, Mass. Dow Jones& Co). http://online.barrons.com/home-page

One of the most respected news magazines for the finance/investment sector. Provides weekly overviews of all domestic and foreign stock exchanges. Barron's also profiles other markets and activities like bonds, mutual funds, and commodities markets.

The Economist (London: Economist Newspaper). http://www.economist.com/

One of the oldest financial publications in the world. This British weekly publication provides finance/investment news from an international perspective.

The Journal of Finance (New York: American Finance Association). http://www.afajof.org/

A quarterly academic publication that tackles issues in finance/investment.

The Wall Street Journal (New York: Dow Jones News Service). http://online.wsj.com/home-page

The Wall Street Journal is the most respected business daily in the world. It has all the day's stock and market activity and analytical articles about trends and news on the financial scene.

Investor’s Business Daily (Los Angeles: IBD). http://www.investors.com/

IBD is a national business and financial daily newspaper covering investment news and education and emerging market trends. Some free content is available on their web site.

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    Is there something that lists a variety of sources that can be used to research the finance/investment sector?

Bibliographies and literature guides are excellent places to begin or expand a research project. They can provide a framework on which to build a body of research. A few bibliographies that may be of help:
 
Basic Business Library (Westport, Conn.: Greenwood Press, 2002)

Provides a core list of current business resources, both print and online.
 
Business Information: How to Find it, How to Use it (Phoenix, Ariz.: Oryx Press, 1992).
 
A good general listing for sources but somewhat dated, although an updated 3rd edition is expected.
 
Business Statistics on the Web: Find Them Fast-At Little or No Cost (Medford, NJ : CyberAge Books, 2003)
 
A good resource for pointers on where to find data online.
 
Encyclopedia of Business Information Sources (Detroit: Gale Research, triennial).
 
A common title for most library business collections. This source talks about available sources in the finance/investment area by type of resource such as directories, dictionaries, and handbooks.
 
Industry and Company Information: Illustrated Search Strategy and Sources (Ann Arbor, Mich.: Pierian Press, 1991).
 
While the sources in this book are somewhat dated, the tips and strategies for getting company information are still useful.
 
Strauss's Handbook of Business Information : A Guide for Librarians, Students, and Researchers (Westport, CT : Libraries Unlimited, 2004).
 
An update to the previous 1988 edition, this covers business information according to the formats in which it is made available. The second part of the book covers specific topics within the area of business.

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    The world of finance/investment has all sorts of strange terms. Are there good dictionaries and handbooks that define the lingo that is used in this area of business?

The terminology of this field can be daunting. A number of sources are available that might be of help a few recent examples would include:

Barron's Finance & Investment Handbook (Hauppauge, N.Y.: Barron's Educational Series, 2007).

A comprehensive guide that includes a large glossary, directory, research bibliography, and guide to personal investment.

A Dictionary of Finance and Banking (Oxford: Oxford University Press, 2008).

A good basic dictionary for finance and the related field of banking.

International Dictionary of Finance (New York: Wiley, 2000).

Another good dictionary from a British perspective.

McGraw-Hill Dictionary of International Trade & Finance (New York : McGraw-Hill, 1994)

A widely-held title.

Wall Street Dictionary (Franklin Lakes NJ: Career Press, 1999).

A good dictionary for those interested in words that are commonly used at the stock exchange.

Wall Street Words: an Essential A to Z Guide for Today's Investor (Boston: Houghton Mifflin, 1997).

Another good dictionary geared towards the investor in stocks. 

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    How do I reach people and professionals within this industry?

Encyclopedia of Associations (Detroit: Gale Research).

This standard directory has a large list of associations that pertain to the finance/investment area.

The Financial Industry Regulatory Authority (FINRA), 1735 K St., NW, Washington DC, 20006, (301) 590-6500,
http://www.finra.org/index.htm

FINRA oversees over 5,000 brokerage firms, about 172,000 branch offices and more than 676,000 registered securities representatives.

Investment Company Institute, 1401 H St. NW, 12th Fl., Washington, DC 2005-2148, (202) 326-5800, http://www.ici.org

An association of investment companies that serve as a clearinghouse for information about mutual funds.

New York Society of Security Analysts, 1601 Broadway, 11th floor, New York, NY 10019-7406, (212) 541-4530, http://www.nyssa.org

An association of stock brokers and investment professionals that work in New York based trading houses.

Security Traders Association, 420 Lexington Avenue, Suite 2334, New York, NY 10170, (212) 867 7002, http://www.securitytraders.org

The professional and trade association for licensed stock and security traders.
 

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Last updated 11/30/09
Previously maintained by Celia Ross, Columbia College, Chicago
Originally created by Joseph E. Straw, University of Akron

Sponsored by the BRASS Education Committee