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FINANCIAL PLANNING TERMS...Stock
A stock is a share in the ownership of a company. As an owner, investors have a claim on the assets and earnings of a company as well as voting rights with the shares. Compared to bonds, stock investors are subject to a greater risk of loss of principal. Stock prices will fluctuate, and there is no guarantee against losses. Stock investors may or may not receive dividends. Dividends and gains on an investment may be subject to federal, state or local income taxes.
Standard & Poor's 500 Stock Index is an index consisting of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large-cap universe.
The DFA Micro Cap Portfolio (formerly U.S. 9-10 Small Company Portfolio) is a mutual fund investing in the smallest 5% of the market universe or smaller than the 1,500th largest US company. The DFA U.S. 9-10 Small Company Portfolio targeted companies in the lowest 9th and 10th deciles ranked by market cap. Small company stocks tend to be less liquid and have greater price fluctuations compared to large company stocks.