STOCKS and BONDS

for General Mathematics

Senior High School (CORE)
Quarter 2 / Week 4

1
 FOREWORD

This Self-Learning Kit for General Mathematics is

designed specifically for Grade 11 students in the Senior
High School. Thus, a modest background in grade school
mathematics is important, written in a precise, readable,
and conventional manner to facilitate students’
understanding of the subject.
It is aligned with the BEC of the Department of
Education following the prescribed MELCs (Most Essential
Learning Competencies.
It has the following features proven to be valuable
aids to learning Mathematics even at home.
I. What happened
This section contains pre-activities like review of the
prior knowledge and a Pretest on what the learners have
learned in their previous discussions.
II. What I Need To Know
This section contains definition of stocks and bonds,
illustrations of each and its distinguishing features. Examples
and the corresponding solutions that clearly illustrate the
concept are cited in this section.
III. What I have Learned
The exercises contained in this section are guaranteed
to build mathematical comprehension, skills, and
competence. These serve as a diagnostic tool to identify
the learners’ areas of strengths and difficulties.

2
 LESSON ILLUSTRATING and DISTINGUISHING STOCKS and
1 BONDS

OBJECTIVES:
K: Illustrate problems related to stocks and bonds;
S: Distinguish between stocks and bonds;
A: Appreciate the importance of illustrating and
distinguishing between stocks and bonds to real life
scenario.

LEARNING COMPETENCIES:

Illustrates stocks and bonds (M11GM-IIe-1).

Distinguishes between stocks and bonds (M11GM-IIe-1).

I. WHAT HAPPENED
History of Stocks and Bonds
The trading of goods began in the earliest civilizations. Early merchants
combined their money to outfit ships and caravans to take goods to faraway
countries. Some of these merchants organized into trading groups. For
thousand of years, trade was conducted either by these groups or by
individual traders.
During the Middle Ages, merchants began to gather at annual town fairs
where goods from many countries were displayed and traded. Some of these
fairs became permanent, year-round events. With merchants from many
countries trading at thee fairs, it became necessary to establish a money
exchange, or bourse, to handle financial transactions.
One important annual fair took place in the city of Antwerp, in present-
day Belgium. By the end of the 1400’s, this city had become a center of
international trade. A variety of financial activities took place there. Many
merchants speculated—that is, they bought goods for certain prices and
hoped that the prices would rise later so they could make profits when they
sold the goods. Wealthy merchants or moneylenders also lent money at high
rates of interest to people who needed to borrow it. They then sold bonds
backed by these loans and paid interest to the people who bought it.
(Goodman, n.d.)

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PRE-TEST:
Direction: Read and analyze each problem. Write the letter of the correct
answer in your activity sheet/notebook.
1. Which refers to a place where stocks can be bought or sold?
a. Share c. Stocks
b. Bond d. Stock market
2. Which refers to the periodic interest payment that the bondholder receives
during the time between purchase date and maturity date that is usually
received semi-annually?
a. Interest c. Coupon
b. Coupon rate d. Price of a bond
3. Which refers to a share in the ow000nership of a company?
a. Share c. Stocks
b. Bond d. Stock market
4. Which refers to an interest-bearing security which promises to pay a stated
amount on the maturity and regular interest payments?
a. Share c. Stocks
b. Bond d. Stock market
5. Which refers to a financial instrument with a lower risk but lower yield?
a. Share c. Stocks
b. Bond d. Stock market
6. Which refers to the present value of all cash inflows to the bond holder?
a. Dividend per share c. Fair price of a bond
b. Market value d. Par value
7. Which refers to the per share amount as stated on the company certificate?
a. Dividend per share c. Fair price of a bond
b. Market value d. Par value
8. Which refers to the ratio of the annual dividend per share and the market
value per share?
a. Stock yield ratio c. Fair price of a bond
b. Market value d. Par value
9. Which refers to the ratio of the dividends to the number of shares?
a. Dividend c. Dividend per share
b. Par value d. Market value
10. Which refers to the share in the company’s profit?
a. Dividend c. Dividend per share
b. Par value d. Market value

4
II. WHAT YOU NEED TO KNOW
DISCUSSION:
DEFINITION OF TERMS:
Stocks are shares in the ownership of the company.
Dividend is a share in the company’s profit.
Dividend per share is a ratio of the dividends to the number of shares.
Stock Market is a place where stocks can be bought or sold. The stock
market in the Philippines is governed by the Philippine Stock
Exchange (PSE)
Market Value is the current price of a stock at which it can be sold.
Stock Yield Ratio (current stock yield) is the ratio of the annual dividend
per share and the market value per share.
Par Value is the per share amount as stated on the company’s
certificate that is determined by the company and remains stable
over time.
Bond is the interest-bearing security which promises to pay:
1. a stated amount of money on the maturity date; and
2. regular interest payments called coupon.
Coupon is periodic interest payment that the bondholder receives
during the time between purchase date and maturity date that is
usually received semi-annually.
Coupon Rate (r) is the rate per coupon payment period.
Price of a bond (P) is the price of the bond at purchase time.
Fair Price of a bond is the present value of all cash inflows to the bond
holder.
(Crisologo 2013)

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STOCKS: Buying part ownership in a corporation

When an investor buys shares of stock, he or she buys part ownership in a

corporation. As such, the value of that
corporation's stock will tend to reflect
the earnings experience of the firm —
up during profitable periods and down
during periods of loss. Generally
speaking, the higher the potential
return, the higher the risk. For example,
stock investors expect a fairly high rate
of return because there is no schedule
of repayment and no stated rate of
return like that paid by fixed-income https://tradingeconomics.com/philippines/stock-market
securities such as bonds.
(Russel, 2020)
Stocks can be bought or sold at its current price called the market value.
When a person buys some shares, the person receives a certificate with the
corporation’s name, owner’s name, number of shares and par value per share.

Types of Stocks:
1. Common Stock
This entitles shareholders to share in the company’s profits through
dividends and/or capital appreciation. Common stockholders are given
the voting rights, with the number of votes directly related to the number
of shares owned.

2. Preferred Stock
This is considered less volatile than common stock but typically less
potential for profit. Preferred stockholders do not have voting rights but
have a greater claim to the company’s assets.

BONDS: Making a loan to a corporation

Bonds represent loans made by investors to companies and other
entities, such as branches of the government, that have issued the bonds to
attract capital without giving up managing control. It is an interest-bearing
security which promises to pay amount of money on a certain maturity date
as stated in the bond certificate.

Bondholders do not share in a company’s profits, rather, they receive a

fixed return on the investment called the “coupon rate” and is a percentage
of the bond’s original offering price. On the maturity date, the bondholders will
receive the fix amount of the bond.

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Types of Bonds:

1. Government Bonds
Bills: debt securities maturing in less than one year
Notes: debt securities maturing in one to 10 years
Bonds: debt securities maturing in more than 10 years

2. Municipal Bonds
Municipal Bonds are the next progression in terms of risk. Cities
don’t go bankrupt that often, but it can happen. Often, the return is not
taxable.

3. Corporate Bonds
Corporate bonds are characterized by higher yields because
there is a higher risk of a company defaulting than a government.

4. Zero-Coupon Bonds
This a type of bond that makes no coupon payments but instead
is paid at the maturity of the bond.

Comparison of Stocks and Bonds

Stocks Bonds
A form of equity financing or raising
A form of debt financing or raising
money by allowing investors to be part
money by borrowing from investors.
owners of the company.
Stocks prices vary every day. These Investors are guaranteed interest
prices are reported in various media payments and a return of their money
(newspapers, TV, internet, etc.) at the maturity date.
Investing in stock involves some Uncertainty comes from the ability of
uncertainty, Investors can earn if the the bond issuer by the government
stock prices incre3ase, but they can pose less risk than those by companies
lose money if the stock prices decrease because the government has
or worse, if the company goes guaranteed funding (taxes) from which
bankrupt. it can pay its loans.
Higher risk but with possibility of higher
Lower risk but lower yield.
returns.

Can be appropriate for retirees

Can be appropriate if the investment is
for the long term (10 years or more). This
can allow investors to wait for stock
prices to increase if ever they go low.
(because of the guaranteed fixed
income) or for those who need the
money soon (because they cannot
afford to take a chance at the stock
market.)

7
STOCKS
Example Problem 1.
A certain financial institution declared ₱30,000,000.00 dividend for the
common stocks. If there are a total of ₱700,000.00 shares of common stock,
how much is the dividend per share?
Given:
Total Dividend =₱30,000,000.00
Total shares = ₱700,000.00
Find:
Dividend per share
Solution:
Total Dividend 30,000,000
= = 42.86
Total Shares 700,000

Therefore, the dividend per share is ₱42.86.

Example Problem 2.
A certain corporation declared a 3% dividend on a stock with a par
value of ₱500.00. Mrs. Lingan owns 200 shares of stock with a par value of
₱500.00. How much is the dividend she received?
Given:
Dividend Percentage = 3%
Par Value = ₱500
Number of Shares = 200
Find:
Dividend
Solution:
Dividend per share = Par value x Dividend Percentage
The dividend per share is ₱500.00 x 0.03 = ₱15.00.
Since there are 200 shares, the total dividend is
₱15/share x 200 shares = ₱3,000.00.
Thus, the dividend is ₱3,000.00.

8
Example Problem 3.
Corporation A, with a current market value of ₱52.00, gave a dividend
of ₱8.00 per share for its common stock. Corporation B, with a current market
value of ₱95.00, gave a dividend of ₱12.00 per share. Use the stock yield ratio
to measure how much dividends shareholders are getting in relation to the
amount invested.
Given:
Corporation A Corporation B
Dividend per share = ₱8 Dividend per share = ₱12
Market Value = ₱52 Market Value: ₱95
Find:
Stock Yield Ratio Find Stock Yield Ratio
Solution:
dividend per share dividend per share
Stock yield Ratio= Market Value
Stockyield Ratio= Market Value
8 12
= 52 = 95

= 0.1538 =0.1263
=15.38% =12.63%

Corporation A has a stock yield ratio of 15.38% and Corporation B has a

stock yield ratio of 12.63%. Since Corporation A has higher stock yield ration
than Corporation B, thus, it is a wiser to invest in Corporation A.

BONDS
Example Problem 1.
Determine the amount of the semi-annual coupon for a bond with a
face value of ₱300,000.00 that pays 10%, payable semi-annually for its
coupons.
Given:
Face Value F = ₱300,000.00
Coupon Rate r = 10%
Find:
Amount of the Semi-Annual Coupon
Solution:
Annual Coupon Amount:
300,000 (0.10) = 30,000
Semi-Annual Coupon Amount :
30,000 (1/2) = 15,000
Thus, the amount of the semi-annual coupon for a bond is P15,000.00.

9
Example Problem 2.
Sonia bought fifty 1,000 ACTS bond at ₱1.03. What is her total investment
in ACTS bonds?
Solution:
Market Price of 1 bond:
1.03 x P1000 = P1,030.00
Total Investment:
1,030 x 50 = P51,500.00
Thus, the amount of Sonia’s total investment is ₱51,500.00.
When bonds are bought and sold through a broker, the broker charges
a broker’s commission or brokerage fee. Hence, the amount investment
becomes the market price of the bond plus the broker’s commission.

Example Problem 3.
Mr. Tee owns 45 bonds with a par value of ₱1,000.00 each and pays 8
½ % interest. What annual income does Mr. Tee get from these bonds?
Given:
Number of bonds = 45
Rate: r = 8 ½%
Par Value = 1,000
Find:
Annual Income
Solution:
Par Value of 45 bond:
45 x 1,000.00 = ₱45,000.00
Annual Income = Par value of number of bonds x rate x time
=₱45,000 x 0.085 x 1
=₱3,825.00
Thus, the annual income for one year is ₱3,825.00

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III. WHAT HAVE I LEARNED

EVALUATION/POST TEST:
Direction: Read and analyze each problem. Write your answer in your activity
sheet/notebook.
A. Identify if the following statement is a characteristic of a STOCK or BOND.
1. A form of equity financing or raising money by allowing investor to be part
owners of the company.
2. A form of debt financing, or raising money by borrowing from investors.
3. Investors are guaranteed interest payments and a return of their money at
the maturity period.
4. Investors can earn if the security prices increase, but they can lose money if
the security prices decrease or worse, if the company goes bankrupt.
5. It can be appropriate for retirees (because of the guaranteed fixed income)
or for those who need the money soon.

B. Answer the following problems completely.

1. A certain corporation declared a 5.7% dividend on a stock with a par

value of ₱700.00 Mr. Dave owns 150 shares of stock with a par value of
₱700.00 How much is the dividend he received?
2. A certain financial institution declared a ₱50 500, 000.00 million dividends
for the common stocks. If there are a total of 500,000 shares of common
stock, how much is the dividend per share?
3. Determine the amount of the semi-annual coupon for a bond with a
face value of ₱200,000.00 that pays 7.5%, payable semiannually for its
coupons.
4. A certain businesswoman owns 60 bonds with a par value of ₱1,250
each and pays 7.2 % interest. What annual income does she get from
these bonds?

11
 REFERENCE
Crisologo, L., et al. 2013. General Mathematics Teacher’s Guide. Department
of Education-Bureau of Learning Resources (DepEd-BLR).

Verzosa, D., et al. 2016. General Mathematics Learner’s Materials. Department

of Education-Bureau of Learning Resources (DepEd-BLR).

12
 SYNOPSIS AND ABOUT THE AUTHOR
This SLK (Self-Learning Kit) is ANSWER KEYS
about illustrating and distinguishing
between stocks and bonds. Here
income)
4. ₱5,400 (annual
you will learn how to compute the (semi-annual coupon)
dividend per share and annual
income of a bond.
3. ₱7, 500.00 5. BOND

(dividend per share) 4. STOCK

As you go over the discussion
and exercises, you will appreciate
2. ₱101.00 3. BOND

the importance of engaging and (total dividend) 2. BOND

being a part owner of any 1. ₱5, 985.00 1. STOCK

corporations as stockholders or B. A.
bondholders. POST TEST:
Find enjoyment in learning 10. A 9. d 8. a 7. d 6. c
this SLK and go over the discussion
and examples if you have not yet
5. B 4. b 3. c 2. c 1. d

mastered a concept. PRE-TEST:

AUTHOR
MERCYDITHA D. ENOLPE received her undergraduate degree
and master’s degree from Negros Oriental State University
(NORSU). She is currently pursuing her Ph.D. Math Education
degree of that same University. Mrs. Enolpe is presently the
Teacher In-Charge-SHS Department of Jose Marie Locsin MHS,
Zamboanguita. At the same time, handling mathematics
subjects of the school. She has contributed significantly to the
crafting of the Daily Lesson Log for teachers in the Division of
Neg. Or, specifically General Mathematics subject. She is also
the District Planning Coordinator-SHS of the District of
Zamboanguita.

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 LESSON
MARKETS for STOCKS and BONDS
2

OBJECTIVES:
K. Identify the different markets for stocks and
bonds;
S. Describe the different markets for stocks and
bonds;
A. Develop appreciation on the importance of
learning the different markets for stocks and bonds
to real life situation.

LEARNING COMPETENCY:

Describes the different markets for stocks and bonds

(M11GM-IIe-3).

I. WHAT HAPPENED
PRE-TEST:
Direction: Copy and complete the crossword by filling in a word that fits each
clue. Answer in your activity sheet/notebook.

Across:
1. A place where investors
go to trade equity
securities
3. The entities that develop,
register, and sell
instruments
5. Where investors go to
trade debt securities

Down:
2. The entities buy and sell
bonds
3. Evaluate risks in the
financial world

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II. WHAT YOU NEED TO KNOW

DISCUSSION:

Stocks and Bonds are two of the most traded types of assets—each
available for sale on several different platforms or through a variety of
markets or brokers.

MARKETS FOR STOCKS AND BONDS:

1. The Stock Market

▪ A place where investors go to trade equity securities (i.e. share) issued
by corporations. Stocks are traded on stock exchanges.
▪ It brings buyers and sellers together into a fair, regulated, and controlled
environment where they can execute their trades. This gives those
involved the confidence that trading is done with transparency, and
that pricing is fair and honest. This regulation not only helps investors, but
also the corporations whose securities are being traded. The economy
thrives when the stock market maintains its robustness and overall health.

Two Components of Stock Market

1. Primary market which is reserved for first-run equities so initial public

offerings (IPOs) will be issued on this market and facilitated by
underwriters, who set the initial price for securities.
2. Secondary market which is where the most trading activity takes
place after equities are opened up by the underwriters.

*The Philippine Stock Exchange, Inc. (PSEi) is the national stock

exchange of the Philippines. The exchange was created in 1992 from the
merger of the Manila Stock Exchange and the Makati Stock Exchange.

Online trading refers to buying and selling financial instruments via

internet. There are available online brokers accredited by the Philippine Stock
Exchange, Inc. such as COL Financial, BDO Nomura, BPI Trade, First Metro,
ABCSI and many others available online.

15
2. The Bond Market (Debt or Credit Market)
▪ A place where investors go to trade (buy and sell) debt securities issued
by corporations or governments. It is also known as the debt or the credit
market.
▪ Securities sold on the bond market are all various forms of debt.
▪ Buying a bond, credit, or debt security, you are lending money for a set
period and charging interest—the same way a bank does to its debtors.

Two Segments of Bond Market

1. Primary Market is referred to as the “new issues” market in which

transactios strictly occur directy between the bond issuers and the
bond buyers. It creates brand new debt securities that have not
previously been offered to the public.
2. Secondary Market is where securities that have already been sold in
the primary market are then bought and sold at later dates. These
secodary market issues may be packaged in the form of pension
funds, mutual funds, and life insurance policies.

Types of Bond Market:

1. Municipal Bonds (muni bonds) are locally issued states, cities, special
purpose districts, publicly owned airports and seaports, and other
government owned entities who seek to raise cash to fund various
projects.
2. Mortgage-Backed Bonds consist of pooled mortgages on real estate
properties that are locked in by the pledge of particular
collateralized assets and pay monthly, quarterly, or semi annual
interest.
3. Emerging Market Bonds are issued by governments and coompanies
located in emerging market economies. These bonds provide much
greater growth opportunities but greater risk than developed bond
markets.
(Chen, 2020)

The bond market does not have a centralized location to trade,

meaning bonds mainly sell over the counter (OTC). As such, individual investors
do not typically participate in the bond market. Those who do, include large
institutional investors like pension funds foundations, and endowments, as well
as investment banks, hedge funds, and asset management firms. Individual
investors who wish to invest in bonds do so through a bond fund managed by
an asset manager.

New securities are put up for sale on the primary market, and any
subsequent trading takes place on the secondary market, where investors buy
and sell securities, they already own. These fixed-income securities range from
bonds to bills to notes. By providing these securities on the bond market, issuers
can get the funding they need for projects or other expenses needed.

16
Three Main Groups involved in the Bond Market

▪ Issuers
These are the entities that develop, register, and sell instruments
on the bond market, whether they're corporations or different levels of
government.

▪ Underwriters
Underwriters usually evaluate risks in the financial world. In the
bond market, an underwriter buys securities from the issuers and resells
them for a profit.

▪ Participants
These entities buy and sell bonds and other related securities. By
buying bonds, the participant issues a loan for the length of the security
and receives interest in return. Once it matures, the face value of the
bond is paid back to the participant.

17
III. WHAT HAVE I LEARNED

EVALUATION/POST TEST:
Identify the following sentences by matching the jumbled words from the box
below. Copy and write your answers in your notebook.

1. ________________ is a place where investors go to trade equity securities

issued by corporations.
2. ________________ is where investors go to buy and sell dept securities
issued by corporations or governments.
3. _______________ typically trade in various exchanges, while
4. _______________ are mainly sold over the counter rather than in a
centralized location.
5. _______________ provides investors with a steady,albeit nominal, source
of regular income.
6. ________________ is a type of security backed by pooled mortages,
paying interest to the holder monthly, quarterly, or semi-annually.
7. ________________ These are the entities that develop, register,and sell
instruments on the bond market, whether they’re corporations or
different levels of government.
8. ________________ usually evaluate risks in the financial world. These buys
securities from the issuers and resells them for a profit.
9. _______________ These entities buy and sell bonds and other related
securities. By buying bonds, these issues the loan for the length of the
seciutiy snd receives interest in return.
10. Give a primary function of the stock market

mbaornkdte
tsoskc bmoonrdteagg
siusesr wurnidteerss

onbds cpiapratntsi

18
 REFERENCE

Silver, Caleb. Bond Market Vs. Stock Market. Investopedia. Dotdash. 2016
Retrieved from https://www.investopedia.com

19
 SYNOPSIS AND ABOUT THE AUTHOR
This SLK (Self-Learning Kit) is ANSWER KEYS
about describing the different execute their trades.

markets for stocks and bonds. Here

controlled environment where they can
together into a fair, regulated, and
you will learn how to use market is to bring buyers and sellers

appropriate financial instruments

10. The primary function of the stock
9. Participants
involving the markets of stocks and 8. Underwriters

bonds in making decisions related 7. Issuers

to your finances in the future.

6. Mortgage bond
5. Bonds

As you go over the discussion,

4. Bonds

you will appreciate the

3. Stocks
2. Bond market
importance of learning to save, 1. Stock market

invest and make money. POST TEST:

5. ISSUERS
Find enjoyment in learning 4. PARTICIPANTS

this SLK and go over the discussion

3. UNDERWRITERS

and examples if you have not yet

2. BOND MARKET
1. STOCK MARKET
mastered a concept. PRE-TEST:

AUTHOR

Therese Fatima F. Sevilla earned two bachelor’s degree,

Bachelor of Science in Computer Engineering and
Bachelor of Secondary Education major in Mathematics.
She graduated Masters of Science in Mathematics
(NORSU-Main Dumaguete City). She is currently teaching
at Negros Oriental High School-Senior High School.

20
 LESSON
MARKET INDICES for STOCKS and BONDS
3

OBJECTIVES:
K. Identify the different market indices for stocks
and bonds;
S. Analyzes the different markets for stocks and
bonds;
A. Develop appreciation on the importance of
analyzing the different market indices for stocks
and bonds to real life situation.

LEARNING COMPETENCY:

Analyzes the different market indices for stocks and

bonds (M11GM-IIe-4).

I. WHAT HAPPENED

In the previous lesson, we were able to learn and site differences

between stock market and bond market. Discussed the main keys that stocks,
or shares of a company, represent ownership equity in the firm, which give
shareholders voting rights as well as residual claim on corporate earnings in the
form of capital gain and dividends. And in the other hand, bond market is
where investors go to buy and sell debt securities issued by corporations or
governments.

21
PRE-TEST:

Write TRUE if the statement is a characteristics of stock market or bond

market and write FALSE if not. Copy and write yours answers in your activity
sheet/notebook.

1. A stock market is a place where investors go to trade equity securities

issued by corporations.
2. The bond market is where investors go to buy and sell debt securities
issued by corporations of governments.
3. Stocks typically trade on various exchange, while bonds are mainly
sold over the counter rather than in a centralized location.
4. The bond market provides investors with a steady, albeit nominal,
source of regular income.
5. Stocks are traded on stock exchanges.

II. WHAT YOU NEED TO KNOW

In this lesson, we will analyze the different market indices for stocks and
bonds. Considering the stock market as well tables, practical information
about stocks, the bond market index and the practical information about
bonds.

DISCUSSION:
What is a Market Index?

Market index refers to a portfolio of securities that represent a particular

section of the stock market
The stock market index is a measure of a portion of the stock market.
One example is the PSE Composite Index or PSEi. It is composed of 30
companies carefully selected to represent the general movement of market
prices. The up or down movement in percent change over time can indicate
how the index is performing.
Other indices are sector indices, each representing a particular sector (
e.g., financial institutions, industrial corporations, holding firms, service
corporations, mining/oil, property).
The stock index can be a standard by which investors can compare the
performance of their stocks. A financial institution may want to compare its
performance with those of others. This can be done by comparing with the
“financials” index.

22
 Stock indices are reported in the business section of magazines or
newspapers, as well as online
(http://www.pse.com.ph/stockMarket/home.html). The following table shows
how a list of index values is typically presented (values are hypothetical).

Index Val Chg %Chg

PSEi 7,523.93 -14.20 -0.19
Financials 4,037.83 6.58 0.16
Holding Firms 6,513.37 2.42 0.037
Industrial 11,741.55 125.08 1.07
Property 2,973.52 -9.85 -0.33
Services 1,622.64 -16.27 -1.00
Mining and Oil 11,914.73 28.91 0.24

In the table above, the terms mean the following:

• Val - value of the index
• Chg - change of the index value from the previous trading day
( i.e., value today minus value yesterday)
• %Chg – ratio of Chg to Val (i.e., Chg divided by Val)

Stock Tables

Newspapers or magazines may also report in stocks prices of individual

companies. The following table shows how stocks can be presented (values
are hypothetical).

52-WK 52-WK VOL

STOCK HI LO DIV CLOSE NETCHG
HI LO (100S)
94 44 AAA 60 35.5 .70 2050 57.29 0.10
88 25 BBB 45 32.7 .28 10700 45.70 -0.2

In the table above, the terms mean the following:

• 52-WK HI/LO – highest/lowest selling price of the stock in the past 52

weeks
• HI/LO – highest/lowest selling price of the stock in the last trading day
• STOCK – three-letter symbol the company is using for trading
• DIV – dividend per share last year
• VOL (100s) – number of shares (in hundreds) traded in the last trading
day (In this case, stock AAA sold 2,050 shares of 100 which is equal to
20,500 shares.)
• CLOSE – closing price on the last trading day.

23
 • NETCHG – net change between the two last trading days (In the case
of AAA, the net change is 0.10. The closing price the day before the
last trading day is Php 57.29-Php 0.10= Php 57.19.)

Such a table may be seen in newspapers or websites which summarize

the price movement on selected stocks for the previous trading day.

Buying or Selling Stocks

To buy or sell stocks, one may go to the PSE personally. However, most
transactions nowadays are done by making a phone call to a registered
broker or by logging on to a reputable online trading platform. Those with
accounts in online trading platforms may often encounter a table like the
following:

Bid Ask/Offer
Size Price Price Size
122 354,100 21.6000 21.8000 20,000 1
9 81,700 21.5500 21.9000 183,500 4
42 456,500 21.5000 22.1500 5,100 1
2 12,500 21.4500 22.2500 11,800 4
9 14,200 21.4000 22.3000 23,400 6

In the table above, the terms mean the following:

• Bid Size – the number of individual buy orders and the total number
of shares they wish to buy
• Bid Price – the price these buyers are willing to pay for the stock
• Ask Price – the price the sellers of the stocks are willing to sell the
stocks.
• Ask Size – how many individual sell orders have been placed in the
online platform and the total number of shares these sellers wish to
sell.

For example, the first row under Bid means that there are a total of 122
traders who wish to buy a total of 354,100 shares at Php 21.60 per share. On the
other hand, the first row under Ask means that just 1 trader is willing to sell his
20,000 shares at a price of Php 21.80 per share.

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Bond Market Indices
The main platform for bonds or fixed income securities in the Philippines
Dealing and Exchange Corporation (or PDEx). Unlike stocks indices which are
associated with virtually every stock market in the world, bond market indices
are far less common. IN fact, other than certain regional bond indices which
have sub-indices covering the Philippines , our bond market does not typically
compute a bond market index. Instead, the market rates produced from the
bond market are interest rates which may be used as benchmarks for other
financial instruments.

The Bond Market and Government Bonds

Government bonds are auctioned out to banks and other brokers and
dealers every Monday by the Bureau of the Treasury. Depending on their
tenors, these bonds are also called treasury bills (-t-bonds), treasury notes (t-
notes), or treasury bonds (t-bonds). The resulting coupon rates and the total
amount sold for these bonds are usually reported by news agencies on the day
right after the auction. Since these bond transactions involve large amounts,
these bonds are usually limited to banks, insurance firms, and other major
financial institutions. The banks may then re-sell these bonds to its clients.
Although the coupon rate for bonds is fixed, bond prices fluctuate because
they are traded among investors in what is called the secondary market. These prices
are determined by supply and demand, the prevailing interest rates, as well as other
market forces. As the price of the bond may increase or decrease, some investors
may choose to sell back to banks the bonds they acquired before their maturity to
cash in their gains even before maturity.

Even though investing in bonds is a relatively safer investment that investing in

stocks, it is important to note that there are still risks involved when investing in bonds.
While unlikely, the most extreme scenario is that of a default by the issuer. In this case,
the investor stands to lose not only the coupons, but even the money invested in the
bond. As such, before investing in bonds, one must be aware not only of the financial
condition of the issuer of the bond, but also the prevailing market conditions.

III. WHAT HAVE I LEARNED

POST TEST:

Answer the following on a separate sheet of paper.

1. What are the basic characteristics of stocks?

2. What are the risks associated with stock investment?
3. Describe the intricacies of the stock market in the Philippines.

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 REFERENCE
Leo Andrei A. Crisologo, Lester C. Hao, Eden Delight P. Miro, Ph.D., Shirlee R.
Ocampo, Ph.D., Emellie G. Palomo, Ph.D., Regina M. Tresvalles, Ph.D.,
(2016) Commission on Higher Education, General Mathematics
Teaching Guide, pp. 245-248

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 SYNOPSIS AND ABOUT THE AUTHOR
This Self-Learning Kit (SLK) is ANSWER KEYS
about describing the stock market
indices. Here you will learn the
importance of stock market
indices.
As you go over the discussion,
you will appreciate the
importance of learning to save,
invest and make money.
Find enjoyment in learning 3. Answers may vary

this SLK and go over the discussion

2. Answers may vary
1. Answers may vary
and examples if you have not yet POST TEST:

mastered a concept.
5. TRUE
4. TRUE
3. TRUE
2. TRUE
1. TRUE
PRE-TEST:

AUTHOR

Therese Fatima F. Sevilla earned two bachelor’s degree,

Bachelor of Science in Computer Engineering and
Bachelor of Secondary Education major in Mathematics.
She graduated Masters of Science in Mathematics
(NORSU-Main Dumaguete City). She is currently teaching
at Negros Oriental High School-Senior High School.

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 DEPARTMENT OF EDUCATION
SCHOOLS DIVISION OF NEGROS ORIENTAL

SENEN PRISCILLO P. PAULIN, CESO V

Schools Division Superintendent

FAY C. LUAREZ, TM, Ed.D., Ph.D.

OIC - Assistant Schools Division Superintendent
Acting CID Chief

NILITA L. RAGAY, Ed.D.

OIC - Assistant Schools Division Superintendent

ROSELA R. ABIERA
Education Program Supervisor – (LRMS)

ARNOLD R. JUNGCO
Education Program Supervisor – (SCIENCE & MATH)

MARICEL S. RASID
Librarian II (LRMDS)

ELMAR L. CABRERA
PDO II (LRMDS)

MERCYDITHA D. ENOLPE
THERESE FATIMA FABE SEVILLA
Writers

RADHIYA A. ABABON
Lay-out Artist
_________________________________

ALPHA QA TEAM
RICKLEOBEN V. BAYKING
LITTIE BETH S. BERNADEZ
MERCYDITHA D. ENOLPE
RONALD TOLENTINO

BETA QA TEAM
RICKLEOBEN V. BAYKING
LITTIE BETH S. BERNADEZ
GIL S. DAEL
MARIA SOLEDAD M. DAYUPAY
MARIA ACENITH D PASTOR
JEE LIZA T. INGUITO
MERCYDITHA D. ENOLPE
RONALD G. TOLENTINO

DISCLAIMER

The information, activities and assessments used in this material are designed to provide accessible
learning modality to the teachers and learners of the Division of Negros Oriental. The contents of this module are
carefully researched, chosen, and evaluated to comply with the set learning competencies. The writers and
evaluator were clearly instructed to give credits to information and illustrations used to substantiate this material.
All content is subject to copyright and may not be reproduced in any form without expressed written consent from
the division.

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