Friday, December 16, 2011

Stocks and Bonds

  Stocks are when an investor buys shares of stock, he or she buys part ownership in a corporation. As such, the value of that corporation's stock will tend to reflect the earnings experience of the firm — up during profitable periods and down during periods of loss. Generally speaking, the higher the potential return, the higher the risk. For example, stock investors expect a fairly high rate of return because there is no schedule of repayment and no stated rate of return like that paid by fixed-income securities such as bonds. Bonds represent loans made by investors to companies and other entities, such as branches of government, that have issued the bonds to attract capital without giving up managing control. A bondholder, in effect, holds an IOU.
http://www.russell.com/us/education_planning/investing_basics/articles/stocks_and_bonds.asp

https://us.etrade.com/e/t/welcome/whychooseetrade?SC=S056901&ch_id=P&s_id=GOOG&c_id=BR&o_id=60DAY+500&gclid=CP6_sfnphq0CFQMDQAodXn_qTQ

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