Lesson 6.1 Learning Assessment: Key Investment Principles

  • How you can increase your net worth?

    "ASSETS – LIABILITIES = NET WORTH." Before buying and investing in products, you must understand the meaning of net worth is summed up to be. You can increase your net worth in a few way: buying a house, getting a raise, get out of debt, invest in stocks, and spend less.
  • Stocks

    "When you buy common stock, you become a part owner of the company and are known as a stockholder, or shareholder." You can make money in two ways: receiving dividend payments and sell appreciated stocks. "Stock appreciation is an increase of stock in the company." This means that the more the company performs and does well the stock appreciation may increase.
  • Specific factors that can impact the value of stocks

    Factors that may be impacted by the value of stocks can make the stock rise or fall.
    Company news and performance:
    -"news releases on earnings and profits, and future estimated earnings
    -announcement of dividends
    -introduction of a new product or a product recall
    -securing a new large contract
    -employee layoffs
    -anticipated takeover or merger
    -a change of management
    -accounting errors or scandals"
    Industry performance
    Economic Factors
    -interest rates
    -economic outlook
    -The value of the dollar