Glencoe Accounting

Chapter 20: Completing the Accounting Cycle for a Merchandising Corporation

Making It Personal

Path To Investing, Stocks

As with many things, the key to investing in the stock market is knowledge. When you buy a company's stock, you own a little piece of that firm. It is important to know that you have made a good investment choice and that you understand how the stock will make you money. The Path to Investing Web site provides some essential tips on becoming a shareholder.

Destination Title: Path to Investing, Stocks

www.pathtoinvesting.org/categories/choosinginvestments/stocks/stocks_011.htm

Guided Activity

Start at the Path to Investing Web site. Record your answers to these questions separately.

1. What is an IPO?
2. Click the next link at the bottom of the page. What are blue chip stocks?
3. Click Performance cycles in the left navigation bar. Describe the risks and rewards of investment in small-cap companies.
4. If you began investing in stocks at the age of 25, which type of stock (large-cap, mid-cap, small-cap) would interest you? Why?