Glossary of Stock Terms
What is a 401 k Plan?
401 k plan definition and explanation of this retirement plan.
What is a 403 b Plan?
403 b plan definition and explanation. 403 (b) plans are a type of a retirement plan that carries most of the characteristics of 401k plans.
What is an Annual Report?
By law all companies that are traded publicly are required to issue an annual report. In order to guarantee for the validity of the annual report an accredited accounting firm examines it.
What is Asset Allocation?
Asset allocation definition and explanation. When you establish your investment portfolio it is important to make the appropriate asset allocation.
What are Baby Boomers?
Baby Boomers definition. Characteristics of the baby boomers generation.
What is a Balance Sheet?
Balance sheet definition and information. The balance sheet is an obligatory element of every company’s annual report.
What is a Balanced Investment Strategy?
When you establish your investment plan you should include considerations about the strategy you will follow in order to achieve you financial goals.
What is a Basis Point?
Basis point definition and explanation. Basis point value.
What is a Bear Market?
Bear market definition. Often times the stock market experiences continuing decline which is commonly referred to a bear market.
What is a Blue Chip Stock?
What exactly are blue chip stocks - blue chip stock definition and explanation.
What is a Bellwether?
Bellwether definition and explanation of bellwether stocks. Examples of bellwether companies.
What is a Bull Market?
Often times the stock market experiences continuing rise which is commonly referred to a bull market.
What is a Business Cycle?
Being an educated investor, you should be able to notice when the economy is moving from one business cycle to the other.
What is behind the Buy and Hold Strategy?
The buy and hold strategy requires the investor to exercise the appropriate investment discipline and try to avoid making frequent trades.
What does NASD Stand for?
NASD stands for National Association of Securities Dealers.
What does SIPC Stand for?
SIPC stands for Securities Investor Protection Corporation.
What is a Capital Preservation Strategy?
When you start investing in stocks you should determine the investing strategy you will follow. One of the strategies you can pick is commonly referred to as capital preservation.
What is a Class A Stock?
Class A stock definition and explanation. Issuing of class A stocks.
What is a Class B Stock?
Class B stock definition and explanation. Issuing of class B stocks.
What is a Coincident Economic Indicator?
If you want to find information on the current conditions of the economy you should refer to one of the coincident indicators.
What is Common Stock?
Common stocks represent the major unit by which ownership in a corporation is recognized.
What is a Coupon?
Many people still refer to bond investors as coupon clippers since initially bonds were issued with a book of coupons.
What is a Current Yield?
Current yield includes calculations that are based on the current market price of the bond.
What is a Day Trader?
The major goal of day traders by making numerous trade transactions each day is to earn small profits.
What is a Defined Benefit Plan?
There are different types of retirement plans offered by employers. One of them is the so called defined benefit plan.
What is a Defined Contribution Plan?
One of the many retirement plans you can choose from is the defined contribution plan.
What is a Discount Broker?
When you start investing you might consider the possibility of using the services of a broker. There are different types of brokers and one of them is the so called discount broker.
What is a Dividend Yield?
In order to determine whether a particular stock is under-priced or over-priced you should use dividend yield.
What is a Dividend?
When you become an owner of a company’s stock, the company may pay you the returns in the form of dividend.
What is a Fiscal Year?
Fiscal year definition and explanation. Federal government fiscal year beginning and end.
What is a Fundamental Analysis?
When you consider the investment in a particular stock, you can apply different tools to evaluate its viability. One of them is the fundamental analysis.
What is a Growth Investment Strategy?
When you begin investing in stocks you should choose a strategy. One strategy you can apply is the growth investment strategy.
What is a Growth Stock?
Growth stock definition. Growth stocks are preferred by investors that foresee that the price of the company’s stock will rise.
What is a Lagging Economic Indicator?
If the economy experiences a change of some character, then in order to measure the consequent changes a lagging indicator is applied.
What is a Leading Economic Indicator?
The leading indicator can be applied in order to make a measurement when there are changes in the economic conditions.
What is a Maintenance Margin?
When you open an account a minimum amount of equity must be maintained in it, which is generally referred to as maintenance margin.
What is a Margin Call?
A margin call is issued by your broker when the value of your account is less than the required maintenance minimum.
What is a Margin?
There are many ways in which you can provide financing for your stock investments. One of them is referred to as margin. Margin definition and explanation.
What is a Market Order?
Investors have many tools to use when they stock trade. One of them is a market order.
What is a Mid-cap Stock?
Depending on the market capitalization of the company, stocks are classified in different types. One of them is mid cap stock.
What is a Minimum Margin?
Minimum margin is also known as initial margin or margin requirement.
What is a Nominal Yield?
Nominal yield represents the coupon rate of a fixed income security.
What is a Par Value?
When the bond reaches maturity the bondholder is awarded the bond’s par value.
What is a Penny Stock?
Investors have the option of choosing among many different types of stocks, such as penny stocks.
What is a Position?
In order to determine the current value of the possessed holdings investors generally refer to the term position.
What is a Preferred Stock?
There are many classes of stocks. One of them is preferred stocks.
What is a Price Earnings Ratio?
When you decide on the investment in a particular stock you should make a careful examination of its indicators. One of them is its price/earnings ratio (P/E).
What is a Prospectus?
By law every company is required to issue a prospectus and provide it to its investors.
What is a Qualified Retirement Plan?
There are many types of retirement plans employees can choose from. One of them is the qualified retirement plan.
What is a Round Lot?
One of the terms you should be familiar with when investing in stocks is round lot.
What is a Small Cap Stock?
Depending on the market capitalization of the company, stocks are classified in different types. One of them is small cap stocks.
What is a Stock Screen?
Stock investors have many tools available for making the right investment decisions. One of them is stock screens.
What is a Technical Analysis?
When you evaluate stocks you can apply different techniques. One of them is technical analysis.
What is a Trade?
The term trade refers to the buying and selling of such financial instruments as stocks, bonds, mutual funds and etc.
What is a Value Stock?
Value stock definition. Many investors prefer to spot value stocks and invest in them.
What is a Warrant?
Investors have many tools to choose from when stock investing. One of them is warrant.
What is an Economic Indicator?
In order to determine the state of condition of the economy you should refer to one of the many economic indicators.
What is an Equity Based Evaluation?
The relationship between the equity of a company and the price of its stock is presented by the equity based evaluation.
What is an Income Investment Strategy?
Investors have several investing strategies to choose from. One of them is the income investment strategy.
What is an Income Statement?
When you study a potential investment candidate you should look at its income statement.
What is an Initial Public Offering - IPO?
Initial public offering (also know as IPO) represents the first issuance of a stock by a particular company.
What is an Online Broker?
Investors have many alternatives to choose from to sell and buy stocks. One of them is through the use of an online broker.
What is an Option?
Options definition and explanation. Buying and selling of options.
What is Capital Gain?
Generally, capital gain represents the profits you get when you sell a particular investment. Types of capital gain.
What is Compounding?
One of the tools you can benefit present in most investments is compounding.
What is Diversification?
One of the most important things that you should keep in mind when you construct your investment portfolio is diversification.
What is Earnings per Share - EPS?
Investors use different tools to compare a particular company with other companies. One of them is the earnings per share (also known as EPS).
What is Execution?
When you start trading with stocks you can use different types of orders issued to your broker for the completion of a trade.
What is Inflation?
One of the serious threats of your profits is inflation.
What is Long-Short Investing?
Long-short investing strategy explanation. Meaning behind long and short. Long position and short position definition.
What is Market Capitalization?
When you decide on the investment in a particular company you should study its market capitalization (also known as market cap).
What is Market Timing?
Investors have many investing strategies to choose from. One of them is market timing.
What is Maturity?
The term maturity is usually associated with bonds. Maturity definition and explanation.
What is NASDAQ?
National Association of Securities Dealers Automated Quotations or NASDAQ.
What is NYSE?
NYSE stands for the New York Stock Exchange.
What is Recession?
The economy goes through different cycles. One of them is recession.
What is Risk Tolerance?
Stock investing is surrounded with a high degree of risk, so when you begin in this field it is important to determine your risk tolerance.
What is Risk?
Stock investing is marked with a high degree of risk.
What is SEC?
The SEC stands for the Securities and Exchange Commission.
What is Short Selling?
Many investors use short selling as a way to increase their profits when they expect that the price of particular stock is about to fall.
What is the Dow Jones Industrial Average?
There are many stock indexes that are quoted in the media. The most popular one is the Dow Jones Industrial Average (also know as the Dow).
What is the Federal Reserve Board?
The Federal Reserve Board (also known as the Fed) is the financial entity that stays behind the control of the interest rates.
What is Wealth Building?
One of the wealth building concepts enjoying highest popularity is compounding of interest.
What is Yield to Maturity?
Yield to Maturity is very useful measurement, usually associated with bond investing.
What is Yield?
When you decide on the investment in a particular stock you should study its yield.
What is Momentum Investing?
Momentum investing includes the purchase of stocks that experience significant speeds in their price increase.
What is CANSLIM?
CANSLIM investing carries some of the features of momentum investing with some further added to it.
What is Beta?
Volatility of a particular stock is measured by what is commonly called beta.