STOCK MARKET 101

WHAT ARE STOCKS

Simply the corporation’s equity stake of its owners

A stock is a share of ownership in a company, representing a claim on

the firm’s earnings and assets.

You own a fracture of the asset and earning of the company

 WHAT IS A
STOCK MARKET?

The stock market refers

to public markets that
exist for issuing, buying
and selling stocks that
trade on a stock exchange
or over-the-counter
 THE PHILIPPINE
STOCK EXCHANGE

The Philippine Stock Exchange, Inc. is the national

stock exchange of the Philippines.

One of the oldest stock exchange in Asia

It use to be at
Philippine Stock Exchange Centre, Exchange Road,
Ortigas Centre, Pasig, Metro Manila, Philippines

But now

at its new headquarters in Bonifacio Global City

(BGC) with a special bell ringing ceremony.
TOP 30 LISTED
COMPANIES
 WHAT IS A
STOCK INDEX

An index is a benchmark which is

used as a reference marker index

An indicator of overall
performance of the stock market
 INVESTING INVESTING IN
SECURITIES

It is the ability to make savings

T-bonds
grow to meet long term financial
• > 1 year tenor
expectations
• Sold at a premium – Coupon rate
• Usually paid quarterly
The building of your own
T-bills
personal wealth
• < 1 year tenor
• Sold at a discount – Face value bigger than the invested
amount
• Usually paid semi-annually
INVESTING IN STOCKS

Individuals investing in stocks have the

following rationale:
Owner ship
Liquidity of funds
Make money

Two ways to make money

Dividends
Capital appreciation

Two types of dividends

Cash dividends
Stock dividends

Tip: blue chip stocks (safe)

 CHOOSING THE
STOCK BROKER

a person who buys and sells goods

or assets for others.

Two types of stock broker

Traditional broker

Online trading
 BASIC TRADING CONCEPTS

Technical analysis
Fundamental analysis

Fundamental trading is a method by Technical traders focus on charts and

which a trader focuses on company-specific events graphs. They analyze lines on stock or index graphs for
to determine which stock to buy and when to buy it. signs of convergence or divergence that might indicate
buy or sell signals. Aims to forecast movements

Interested in predicting condition

Fundamental analysis

Ability to pay its debts

Revenue growth
Market position
 COMMON STOCK PREFERRED STOCKS

Common stock allows its holders

Preferred stock pays a predetermined dividend, whereas the
to make a profit through rising
dividends paid to common shareholders tend to vary according
share prices and dividend
to the company's fortunes.
payments.
Dividends on preferred stock are often larger than those on
either common stock or the company's bonds.
Holders of common stock also
get to vote on corporate issues,
Holders of preferred stock do not get a vote on company
such as electing new directors to
matters.
the corporation's board.
 Class A shares: available stocks offered to Filipino share
holders

Class B shares: available stocks offered to foreign

investors

Par value shares: to the stock value stated in the

corporate charter. Shares usually have no par value or
very low par value, such as one cent per share.

SHARE TYPES No Par value shares: which have not be assigned a

definite or fixed value

Founders shares: Issued to the originators of a firm,

these shares (stock) normally do not receive any
return until dividend payable to common stock
holders (ordinary share holders) is paid out.
 DIVIDENDS

Also called distributed profits

Represent corporate profile

Dividends are distributed according to the

proportionate interest of their share holders

Two types o dividends

Cash dividends
Stock dividends
STOCK MARKET 101

The end.