Asset Class – a classification or grouping of investments that exhibit similar characteristics and thus often behave similarly to one another in the marketplace. 

Bear Market – a period when stock prices are falling or are expected to fall. It is commonly defined by market performance decreases of 20% or more.

Bull Market – a period when stock prices are rising or are expected to rise. It is commonly defined by market performance increases of 20% or more.

Dow Jones Industrial Average – a stock index that tracks the share prices of 30 of the largest U.S. companies.

Emerging Market – a country’s economy that is transitioning from the “developing” phase to the “developed phase” and has significant growth and investment potential. Emerging markets tend to also experience higher market volatility due to political instability, currency fluctuations, as well as supply-demand shocks.

Equity Market – a fancier name for “stock market” … an equity market is a market in which shares of companies are issued and traded. Think equity = stock.

Fixed Income – an asset class that refers to investments that provide a return in the form of regular, fixed interest payments and the return of principal at maturity. These investments are typically considered lower-risk compared to equities (stocks), and they are commonly used by investors looking for steady income or less volatility in their portfolios. Examples include: bonds, treasuries, money markets, and CDs.

GDP – Gross Domestic Product measures the monetary value of final and services produced in a country in a given period of time.

Large Cap – a stock from a public company whose total market value is greater than $10 billion.

Market Capitalization (or “cap” for short) – the value of a company represented by the price of the stock multiplied by the number of shares outstanding.  

Mid Cap – a stock from a public company whose total market value is between $2 and $10 billion.

Nasdaq Composite Index – a broad index of over 2,500 stocks listed on the Nasdaq stock exchange heavily weighted toward the Technology sector.

Recession – a period of temporary economic decline generally defined by a decline in GDP in two consecutive quarters.Russell 2000 Index – a market index comprised of 2,000 SmallCap companies.

SEC-registered – a registered investment advisory (RIA) firm that is federally registered with the U.S. Securities and Exchange Commission. 

Small Cap – a stock from a public company whose total market value is under $2 billion.

S&P 500 Index – a group of stocks representing the 500 largest companies in the U.S. by market capitalization.

Volatility – a statistical measure of the dispersion of returns for a given security or market index – often it refers to the amount of uncertainty or risk related to a security’s value. a period when stock prices are falling or are expected to fall. It is commonly defined by market performance decreases of 20% or more.