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Topic starter
1. Annual Report
An annual report is a report prepared by a company that’s intended to impress shareholders. It contains tons of information about the company, from its cash flow to its management strategy. When you read an annual report, you’re judging the company’s solvency and financial situation.
2. Arbitrage
Arbitrage refers to buying and selling the same security on different markets and at different price points. For instance, if stock XYZ is trading at $10 on one market and $10.50 on another, the trader could buy X shares for $10 and sell them for $10.50 on the other market, pocketing the difference.
3. Averaging Down
When an investor buys more of a stock as the price goes down. This makes it so your average purchase price decreases. You might use this strategy if you believe that the general consensus about a company is wrong, so you expect the stock price to rebound later.
4. Bear Market
Trading talk for the stock market being in a downward trend, or a period of falling stock prices. This is the opposite of a bull market. If a stock price plummets, it’s very bearish, read more about bear market.
5. Beta
A measurement of the relationship between the price of a stock and the movement of the whole market. If stock XYZ has a beta of 1.5, that means that for every 1 point move in the market, stock XYZ moves 1.5 points, and vice versa.
6. Blue Chip Stocks
The stocks behind large, industry-leading companies. Blue chip stocks offer a stable record of significant dividend payments and have a reputation of sound fiscal management. The expression is thought to have been derived from blue gambling chips, which is the highest denomination of chips used in casinos.
7. Bourse
This stock market term is a little murky. Technically, it’s just another name for the stock market and originates from a house in which wealthy men gathered to trade shares. However, when you hear it in today’s conversations about the stock market, it usually either refers to the Paris stock exchange or to a non-U.S. stock exchange.
8. Bull Market
sykes thumbs up on the bull
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When the stock market as a whole is in a prolonged period of increasing stock prices. It’s the opposite of a bear market. A single stock can be bullish or bearish too, as can a sector, which I’ll describe later on.
9. Broker
A person who buys or sells an investment for you in exchange for a fee (a commission).
10. Bid
The bid is the amount of money a trader is willing to pay per share for a given stock. It’s balanced against the ask price, which is what a seller wants per share of that same stock, and the spread is the difference between those two prices.
11. Close
The NYSE and Nasdaq close at 4 p.m., with after-hours trading continuing until 8 p.m. The close simply refers to the time at which a stock exchange closes to trading.
12. Day Trading
The practice of buying and selling within the same trading day, before the close of the markets on that day, is called day trading. This is my primary trading strategy, although I have a long-term portfolio, as well. Traders who participate in day trading are often called “active traders” or “day traders.”
13. Dividend
A portion of a company’s earnings that is paid to shareholders, or people that own that company’s stock, on a quarterly or annual basis. Not all companies pay dividends. For instance, if you trade penny stocks, you’re likely not after dividends.
14. Exchange
A place in which different investments are traded. The most well-known exchanges in the United States are the New York Stock Exchange (NYSE) and the Nasdaq.
15. Execution
When an order to buy or sell has been completed, the trader has executed the transaction. If you put in an order to sell 100 shares, this means that all 100 shares have been sold.
16. Haircut
In its most simplest stock market terms, a haircut is an extremely thin spread between the bid and ask prices of a given stock. It can also refer to a situation in which a stock price gets reduced by a specific percentage for margin trades or other purposes.
17. High
A high refers to a market milestone in which a stock or index reaches a greater price point than previously. Record highs can signal that a stock or index has never reached the current price point, but there are also time-constrained highs, such as 30-day highs.
18. Index
A benchmark that is used as a reference marker for traders and portfolio managers. A 10 percent return may sound good, but if the market index returned 12 percent, then you didn’t do very well since you could have just invested in an index fund and saved time by not trading frequently. Examples are the Dow Jones Industrial Average and Standard & Poor’s 500.
19. Initial Public Offering (IPO)
An IPO is the first sale or offering of a stock by a company to the public. It happens when a company decides to go public rather than remain solely owned by private or inside investors. The Securities Exchange Commission (SEC) has strict rules that companies must follow before issuing an IPO.
20. Leverage
I’m not a fan of leverage, but it’s good for you to know this stock market term. When you use leverage, you borrow shares in a stock from your broker with the goal of increasing your profit. If you borrow shares and sell them all at a higher price point, you return the shares and keep the difference. It’s a dangerous game that I urge you to avoid playing.
21. Low
Low is the opposite of high. It represents a lower price point for a stock or index.
22. Margin
A margin account lets a person borrow money (take out a loan, essentially) from a broker to purchase an investment. The difference between the amount of the loan and the price of the securities is called the margin.
Trading on margin can be dangerous because, if you’re wrong about the direction in which the stock will go, you can lose significant cash. You must often maintain a minimum balance in a margin account.
23. Moving Average
A stock’s average price-per-share during a specific period of time is called its moving average. Some common time frames to study in terms of a stock’s moving average include 50- and 200-day moving averages.
24. Open
In the United States, the stock market opens at 9:30 a.m. Eastern time every day. It’s based on the trading hours of the Nasdaq and NYSE. Pre-market trading hours begin at 4:30 a.m. Eastern, but most traders don’t begin paying attention until about 8 a.m. Essentially, open refers to the time at which people can begin trading on a particular exchange.
25. Order
An investor’s bid to buy or sell a certain amount of stock or option contracts constitutes an order. You have to put an order in to buy or sell 100 shares of stock, for instance.
26. Pink Sheet Stocks
The term “pink sheets” refers most commonly to penny stocks, which are traded at $5 per share or less. They’re also called over-the-counter stocks because that’s how they are traded. You won’t find them on the Nasdaq or NYSE, or any other major exchange, and they’re often smaller companies.
27. Portfolio
A collection of investments owned by an investor makes up his or her portfolio. You can have as few as one stock in a portfolio, but you can also own an infinite amount of stocks or other securities.
28. Quote
Information on a stock’s latest trading price tells you its quote. This is sometimes delayed by 20 minutes unless you’re using an actual broker trading platform.
29. Rally
A rapid increase in the general price level of the market or of the price of a stock is known as a rally. Depending on the overall environment, it might be called a bull rally or a bear rally. In a bear market, upward trends of as little as 10 percent can qualify as a rally.
30. Sector
A group of stocks that are in the same industry belong to the same sector. An example would be the technology sector, which includes companies like Apple and Microsoft. Some traders prefer to trade in a specific sector, such as energy, because they know the industry well and can better predict stock price fluctuations.
31. Share Market
Any market in which shares of a particular company are bought and sold. The stock market is an example — and probably the most significant example — of a share market.
32. Short Selling
When you short-sell a stock, you borrow shares from your broker with the promise to return them later. When you sell the borrowed stock, the money goes into your account. But you owe the shares to the broker. It’s a way to take advantage of a stock that you believe will decrease in price. After you sell short, the goal is to buy back the shares at a lower price, taking the difference in price as your profit. If buy to cover at a higher price, you take a loss. There’s also a fee to borrow shares.
I used to short sell on a regular basis. These days I think it’s an overcrowded and risky strategy. OTC without any problems. They’re pretty good about borrowing shares for Short selling is definitely not for newbies or anyone trading with a small account.
33. Spread
This is the difference between the bid and the ask prices of a stock, or the amount for which someone is willing to buy it and the amount for which someone is willing to sell it. For instance, if a trader is willing to trade XYZ stock for $10 and a buyer is willing to pay $9 for it, the spread is $1.
34. Stock Symbol
A stock symbol is a one- to four-character alphabetic root symbol that represents a publicly traded company on a stock exchange. Apple’s stock symbol is AAPL, while Walmart’s is WMT.
35. Volatility
The price movements of a stock or the stock market as a whole. Highly volatile stocks are those with extreme daily up and down movements and wide intraday trading ranges. This is often common with stocks that are thinly traded or have low trading volumes.
I’m a big fan of high-volatility stocks because I can make a big profit off spikes or dips, depending on how I’m trading, in a short period of time. High volatility often makes trading more exciting, but it’s also risky if you’re inexperienced.
36. Volume
The number of shares of stock traded during a particular time period, normally measured in average daily trading volume. Volume can also mean the number of shares you purchase of a given stock. For instance, buying 2,000 shares of a company is a higher-volume purchase than buying 20 shares.
37. Yield
Often refers to the measure of the return on an investment that is received from the payment of a dividend. This is determined by dividing the annual dividend amount by the price paid for the stock. If you bought stock XYZ for $40 per share and it pays a $1.00-per-year dividend, you have a “yield” of 2.5 percent.
https://www.thebalance.com/which-market-to-day-trade-stocks-futures-or-forex-1031237
Posted : 08/12/2021 5:24 am
Topic starter
Buy
To take a position by buying shares of a company.
As a trader, you generally buy shares when you think a stock’s price will rise.
Sell
To sell the shares you currently own.
Traders generally sell shares when they see an opportunity to take profits or they think the stock’s rise is ending.
Bid
When a trader in the market makes an offer to buy shares.
Traders will bid for a stock at a certain price.
Ask
When a trader offers their shares for sale at a certain price.
If a trader holds shares, and they want to sell them at a particular price, they’ll place an order asking buyers to purchase them.
Bid-Ask Spread
The difference between the highest price at which someone is willing to buy shares and the lowest price someone is willing to sell shares.
Bull Market
A market condition where stock prices are continually rising.
Bull markets are characterized by optimism and excitement from traders and investors.
Bear Market
A bear market is the opposite of a bull market. It’s a market condition where prices are continually falling.
Bear markets are times where the outlook appears bad for a company, an industry, or the overall economy. Traders and investors are less willing to buy stocks, and many are looking to sell their stocks. This causes prices to fall.
Limit Order
A type of stock market order that provides instruction to only execute at a certain price, or one that is more profitable.
For example, a trader could place a limit buy order to purchase 100 shares of a stock at $10.20. The broker will attempt to buy 100 shares at a price of $10.20 or below.
Market Order
A type of stock market order that provides instruction to buy or sell as quickly as possible, at whatever price is currently available.
Market orders can be expensive if there’s not enough volume being traded. If you’re going to trade penny stocks, you should almost never use a market order.
Good Till Canceled Order
A type of stock market order to buy or sell shares that remains open until the trade is made or you cancel the order. Also known as a GTC order.
Day Order
A type of stock market order to buy or sell shares in which if the order isn’t filled during the day, it’s automatically canceled at the market close.
Volatility
The statistical measure of how much a stock moves up or down.
Stocks that move up and down wildly are known as volatile stocks. They can provide great profit opportunities, but also come with greater risk.
Liquidity
The measure of a stock’s ability to be bought and sold quickly. More shares being bought and sold means more liquidity.
If there are lots of buyers and sellers trading lots of shares of a stock, you’ll generally find it easier to enter and exit a position.
Trading Volume
The number of shares being traded at a point in time.
More trading volume means a stock is more active, and it’s easier to enter and exit positions.
Going Long
By going long, you’re purchasing shares of a stock and you’re looking to profit if the stock price rises.
Going Short
When a trader looks to profit from a stock’s price going down.
A trader goes short by borrowing shares from a broker, selling them, and hoping to buy them back and return them to the broker after the price has dropped.
Averaging Down
This is where an investor or trader buys more shares of a stock as the price drops, lowering the average price paid for the position.
Averaging down can be an intelligent strategy for long-term investors, but we don’t recommend that active traders do it.
Market Capitalization
Market capitalization, also known as market cap, is the total value of all a company’s shares.
For example, if a company has one million shares outstanding and the stock price is $10 per share, the market cap will be $10 million.
Public Float
This is the term for a company’s freely traded shares. Many companies will have large chunks of shares that aren’t tradeable because they’re held by company management or key investors.
As active traders, we generally look for companies with a small public float, as their prices tend to be more volatile.
Outstanding Shares
This is the total number of a company’s shares. It includes both the public float and restricted shares held by management or key investors.
IPO
IPO stands for initial public offering. It’s when a company goes through the process of selling shares on the stock market for the first time.
Secondary Offering
A company may raise money from investors by offering shares, even after the company’s shares are traded on a stock exchange. This is called a secondary offering.
Blue-Chip Stock
These are large, stable, well-known companies that are often profitable and pay consistent dividends.
Forex
Forex is short for foreign exchange. The term refers to the global trading of currencies in a way similar to the way stocks are traded.
Hedge Funds
A hedge fund is a type of investment fund that often uses non-standard investment and trading techniques.
Hedge funds generally try to be profitable regardless of whether the market is up or down, and they’re generally reserved for high net worth investors.
Mutual Funds
Mutual funds are pools of investor money put together to invest in stocks, bonds, and other financial assets.
ETFs
ETF is short for exchange-traded fund. ETFs are similar to mutual funds in that they’re pools of capital being used for investment purposes. But instead of wiring your money into the fund, you can simply purchase shares of the ETF on a stock exchange.
ADR
ADR is short for American Depositary Receipt. These are certificates that represent shares of overseas stocks.
ADRs allow you to buy and sell overseas stocks on U.S. stock exchanges in much the same way you can trade American stocks.
Beta
The statistical measure of the way a stock performs compared with the broader market. Investors use beta as a way of understanding how much risk there is in holding a stock.
Stockbroker
A person or company that acts as an agent, allowing traders and investors to buy and sell stocks. Need help picking a broker? Find out more here.
Day Trading
The practice of entering and exiting stock trades within a single day.
For example, if you purchase a stock in the morning, then sell it for a profit in the afternoon, you’ve day traded.
Dividend
This is when a company pays a portion of its earnings to its shareholders. Long-term investors and retirees generally focus on dividends.
Stock Charts
The visual graph of the price of a stock over time. Traders use stock charts as a way to help them interpret what the stock price is doing and what’s likely to happen next.
Stock Exchange
A stock exchange is an entity where stocks are bought and sold. The most well-known stock exchanges are the New York Stock Exchange (NYSE) and the Nasdaq.
Execution
Execution is the act of fulfilling a stock trading order.
For example, you place an order with your broker to buy 100 shares of XYZ at $10. When that trade has been completed, you can refer to that order as having been executed.
Margin
Margin refers to the use of borrowed money to trade shares. Some brokers allow margin trading, but we don’t recommend it, especially if you’re new to the markets.
For example, you might have $10,000 in your trading account, but use a margin account to purchase $20,000 of stock. With margin, you can make money and lose money faster. Be careful!
Moving Average
A commonly used technical indicator found on stock charts. The moving average is an average of the stock price over a certain time period.
For example, the 20-day moving average is calculated by taking the price of the stock on each of the prior 20 days, then finding the average of those 20 prices.
It’s a quick and simple way for traders to see the trend direction of a stock.
Stock Portfolio
A stock portfolio is an investor’s collection of stocks.
Trading Mentor
An experienced trader who can shorten your learning curve by teaching you how they trade and what they’ve found to work in the markets.
I’m a huge fan of mentorship, and I teach a bunch of students everything I know about the markets in the SteadyTrade Team community. If you want to get serious about trading, come join us!
Price Quote
A price quote is a stock’s price at a certain point in time. Traders will often want up-to-date price quotes to better analyze stocks and find decent trading set-ups.
Price Rally
A price rally is when a stock price rises at a noticeably quicker pace.
Sector
The stock market is made up of shares of companies in different industries and niches. We refer to them as sectors.
Stock Symbol
A unique collection of letters and/or numbers that represent a stock. Amazon, for example, trades on the Nasdaq under the symbol AMZN.
Dividend Yield
This refers to the size of a company’s dividend compared with the price of its stock.
For example, if a stock price is $20 and the company pays a dividend of $1 per share, the dividend yield would be 5%.
https://stockstotrade.com/40-trading-terms-beginners-infographic/
Posted : 08/12/2021 5:29 am