LEVEL 1 GLOSSARY

• Bonds

  When you buy bonds, you're basically lending money to municipalities, states, and other government entities, which they use for construction projects and other fun stuff. They then pay you back with interest. These aren’t the biggest money makers, but bonds are fairly stable for those of you who think “risk” is a dirty word.

• NASDAQ

  It's known as The National Association of Securities Dealers Automated Quotation System, but suffice to say this stock exchange is one of the biggies.

• Return

  Gain (or loss) from an investment. Unless you're fiscally masochistic, you're going to cross your fingers for a gain.

• Revenue

  The money generated from sales. If you own a lemonade stand and charge 25 cents per cup, add up all the sales for the day and—voila!—that's the revenue (just to keep you on your toes, sometimes people just refer to this as sales).

• Stock

  This is your piece of the corporate pie, and it entitles the holder to a share of assets and earnings.

• Bull Market

  Like a bull charging forward, a “bull market” is typically a market on the upswing. Olé!  

• Debt

  It's a bad word in personal finance, but it's pretty common in the corporate world. This is the money that a company owes to a lender.

• Dow Jones Industrial Average

  The grandaddy of them all when it comes to indices only because it’s the oldest and most popular—not the largest or most representative. The Dow only represents the prices of 30 largest and most widely held companies in the U.S.

• IPO

  Short for Initial Public Offering, this is a private company's way of saying, "Do you want a piece of this?" This is when a company offers shares to the public to get more dough to grow the business. Also known as "going public."

• NYSE

  The New York Stock Exchange, a.k.a. Wall Street, is where stocks are bought and sold.  

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