Editing 1course Stock Market (section)

== Key Terms You Need to Know ==

=== 1. Stocks ===
'''Stocks''' represent ownership in a company. When you buy a stock, you become a shareholder and own a piece of that company. Stocks are also known as shares or equities. Owning stock in a successful company can lead to significant financial gains.

=== Example: If you buy 100 shares of Apple (AAPL), you own a small part of Apple Inc. ===

=== 2. Bonds ===
'''Bonds''' are loans that you give to a company or government in exchange for regular interest payments plus the return of the bond’s face value when it matures. Bonds are considered safer than stocks but typically offer lower returns.

=== Example: When you buy a U.S. Treasury bond, you are lending money to the U.S. government. ===

=== 3. ETFs ===
'''ETFs (Exchange-Traded Funds)''' are investment funds that are traded on stock exchanges, much like stocks. They hold a collection of assets such as stocks, bonds, or commodities, providing diversification.

=== Example: SPDR S&P 500 ETF (SPY) tracks the performance of the S&P 500 index. ===

=== 4. Mutual Funds ===
'''Mutual Funds''' are investment vehicles that pool money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities. They are managed by professional fund managers.

=== Example: Vanguard Total Stock Market Index Fund (VTSAX) invests in a wide array of U.S. stocks. ===

=== 5. Market Indices ===
'''Market Indices''' measure the performance of a group of stocks representing a specific market or sector. The most commonly referenced indices are the S&P 500, Dow Jones Industrial Average (DJIA), and NASDAQ Composite.

=== Example: The S&P 500 includes 500 of the largest U.S. companies and is often used as a benchmark for the overall market. ===

=== 6. Bull and Bear Markets ===
'''Bull Market:''' A period when stock prices are rising or are expected to rise. It’s characterized by investor optimism and confidence.

'''Bear Market:''' A period when stock prices are falling or are expected to fall. It’s characterized by investor pessimism and fear.

=== Example: The 2008 financial crisis led to a bear market, while the subsequent recovery created a long bull market. ===