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Appendix A. Glossary - Pg. 87

Glossary initial public offering 87 The first time a company issues stock for sale to the public is the initial public offering or IPO. The company is said to be "going public" when this happens. The offering is highly regulated and often surrounded by a lot of media attention. Hot technology stocks often see immediate price increases of 300 percent or more. Market share is the measurement of how strong a company is in its particular market. The more market share it controls, the easier it is to influence prices and beat back competition. Options give the owner the right, but not the obligation, to purchase or sell a specific number of shares of a stock at a specific price. A private company has just a handful of investors, in some cases just one investor. Most companies in the United States have this form of ownership. The company's stock does not trade on any public stock exchange. A public company's stock trades openly on one of the major stock exchanges. A publicly traded company is one that has made its shares of stock available to the public for purchase. These are the companies whose stock trades on the major stock exchanges like the New York Stock Exchange. Qualified retirement plans authorized by the tax code allow money to grow with no taxes due until withdrawals begin, usually at age 65. Pension plans, 401(k) plans, and individual retirement ac- market share options private company public company publicly traded qualified retirement plan