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| Glossary of Trading Terms |
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Account: The firm's record of your transactions.
Account Value: The estimated value of your portfolio combining your cash balance and assets and deducting liabilities.
All or Nothing: Designating that all the shares in your order must be filled or the entire order will be cancelled. Abbreviated as AON.
Annual Report: This is the yearly financial statement that shows the corporation's financial condition.
Asking Price: The lowest price you can expect to purchase an issue.
At The Market: An order placed by an individual instructing a broker to buy or sell an issue at the current trading price.
Bear: An individual who believes the market will decline.
Bid Price: The highest price at which a individual can expect to sell an issue.
Block Trade: A trade of 2,000 or more shares.
Book Value: The total assets of a company minus liabilities and shares of preferred stock.
Bond: A promissory note of a corporation.
Broker: Someone who acts as an agent in the buying and selling of shares.
Bull: An individual who believes the market will rise.
Buying Power: The amount you may spend to purchase long shares. This includes the amount your broker is willing to loan you.
Cash Balance: The amount of cash in your account. Can be used to buy long shares, as collateral for shorted shares, or for withdrawal.
Certificate: A document proving ownership of an issue.
Churning: Excessive trading of an issue within an account by an authorized individual that has control over the account.
Close: The price of the last trade of the previous day. Sometimes abbreviated as Prev Cls.
Collateral: Assets, such as your cash balance, that are pledged by a borrower to guarantee the repayment of a loan, margin, or short sale.
Commission: The broker's fee for buying or selling an issue.
Cover: After a trader has sold a stock short, they eventually need to buy the stock back to repay the borrowed shares to their broker, hopefully at a lower price.
Common Stock: The issues having last claim to the assets of a corporation. Most common shares have voting rights and many pay a dividend.
Day Order: A buy or sell order that is valid only for a single trading day.
Dealer: When a brokerage house is acting as a principal in a trade.
Debenture: A bond backed solely by the general credit of a company.
Diversification: Spreading your capital among many different types of investments for the express purpose of reducing risk.
Dividend: A payment made by the company to the stockholder. This is usually money derived from corporate profits.
Dividend Pot: The amount of dividends that are available to be paid to shareholders. Trading activity will increase a stock's Dividend Pot.
Dollar Cost Averaging: Buying securities at regular intervals and at fixed amounts.
Downtick: A stock's most recent trade was at a lower price than the trade before it. Usually designated with a red arrow.
Earnings Per Share: The amount of net income earned for each share of common stock after payment of dividends to preferred stockholders.
Effective Date: A date in time when the registered offering of an issue may be sold to the public.
End of Day: An order designated as "EOD" will expire at the end of the trading day. The AllSportsMarket trading day officially ends at 12:01 am, however the End of Day Processes can take 20-30 minutes to complete.
Equity: The ownership value of an issue held in the brokerage name.
Fiscal Year: A corporation's accounting year based on a 12 month time period. Not necessarily a calendar year.
Float: The number of shares of a company generally available for buying and selling.
Floor Trader: An exchange member who trades on the floor of a market for his own account.
Fundamental Analysis: Evaluating a company by studying management and financial conditions to gauge the company's true value.
Going Public: A first time offering of shares to the public.
Good 'Til Cancelled: An order to buy or sell that continues in effect until cancelled. Termed a GTC order.
Growth Stock: A company that has demonstrated the ability to increase profits over at least a five year period of time.
Holding Company: A corporation which owns the shares of another.
Hot Issue: A new issue that is in great demand.
Hype: Misleading and inaccurate information used to promote a stock.
In-and-Out: Purchasing a stock and then selling it almost immediately. Usually for a quick profit.
Inactive Stock: A stock that trades on very low volume.
Indenture: A written formed contract between the issuer of a bond and it's investors.
Inside Information: Company information that has not been made public.
Insider: An executive or stockholder of a public firm owning more than ten percent of the company's shares.
Investment Banker: The underwriter taking a firm public.
IPO: Initial Public Offering. When a new stock is added to the market, it's shares are sold to traders through the IPO broker(s).
Issue: A company's stock.
Joint Tenants: More than one investor owning the same stock in a joint account.
Leverage: Using borrowed funds to increase the rate of return on a investment.
Limit Order: When an individual instructs a broker to buy or sell a stock at a clearly stated price or better.
Long: Buying shares with the intention of selling them later at a higher price to make a profit.
Long Margin Liability: The total amount you have borrowed from your broker to purchase shares. This is repaid as you sell each open long position.
Long Stock Value: The combined value of all long shares in your portfolio at their current price.
Manipulation: The buying or selling of shares to create a false or misleading appearance of active trading.
Margin: The act of buying shares with borrowed money provided by the brokerage firm.
Margin Call: When your broker contacts you because your cash balance is not enough to collateralize the amount you borrowed for either short or long shares. You must either increase your cash balance, or close open positions, or else your broker may close your positions on your behalf.
Market Maker: A dealer who maintains firm bid and offer prices in a specific stock by standing ready to buy or sell round lots of stock at publicly quoted prices.
Market Price: The current or last reported price at which a stock traded.
Match Orders: This occurs when a broker attempts to offset either heavy buying or selling in a particular stock.
Member Firm: An investment house which belongs to a registered exchange.
Net Income: Profits from company operations.
Net Worth: Assets minus liabilities.
Nominal Quotes: Quotes that are neither recent or necessarily accurate. Sometimes called "ball-park quotes".
Odd Lot: Stock trades of fewer than 100 shares.
Off-The-Board: Refers to shares not executed on one of the national exchanges.
Offer: The price a security is offered for sale.
Open: The price of the first trade of the day.
Open Order: An order that has been given to buy or sell stock but has not yet been completed or filled.
Order Streamer: Data on the Pro-Trade Screen that shows the most recents trades for a given stock.
Paper Profits: Profits on shares that become real only when the shares are actually sold and the proceeds received.
Par Value: Dollar value assigned to a share of stock by the company's charter.
Passed Dividend: A term used to describe when a company omits it's dividend.
Penny Stocks: Low priced stocks selling for less than one dollar per share. Sometimes called micro-caps. Many big name corporations have traded in this price range at one time or another.
Pink Sheets: A listing of bid/ask prices and market-makers of stocks that do not have a stock symbol.
Plunder / Pot Plunder: When a team beats another team in a matchup, it takes part of the loser's Dividend Pot. This is called the Plunder.
Portfolio: All the specific shares being held by an individual.
Position: Any long or short shares held by an individual.
Post: A specific location on the exchange floor where stocks of certain companies are traded.
Prev Cls: Previous Close; the price of the last trade of the previous day.
Public Offering: The sale of shares to the general public.
Quote: Usually the best bid/ask price you receive from your broker. It's the highest bid to buy and the lowest offer to sell your stock at a specified time.
Rally: A very sudden increase in market value and activity.
Registered Representative: Another name for a broker.
Reverse Split: A reduction in the total outstanding number of shares caused by reissuing shares at a higher par value.
Rights Offering: An offering by a company to it's shareholders to purchase additional shares of stock for a definite period of time.
Round Lot: Usually a 100 share unit of stock.
Secondary Market: The market in which you can buy and sell shares following an initial offering.
Sell Order: An order given by a individual to his broker to sell his stock.
Shares Outstanding: The number of company shares owned by the public and not held by the company.
Shot From The Sky: Slang used to describe a sharp market downturn.
Short Sale: Borrowing a share and selling it expecting the share to decline in price so you can buy it back at a lower price.
Short Squeeze: When many traders have shorted a stock and the price begins to rise and there are not enough sellers for them to cover their shorts.
Short Stock Liability: The total amount it would cost you to cover all your short positions at their current price.
Shorting Power: The maximum value of stocks you can sell short.
Specialist: An exchange member who stands ready to buy and sell a stock in order to maintain an orderly market.
Stock-Limit Order: An order to buy or sell a stock when the price reaches a certain level.
Stock Split: Dividing existing stock into more shares and reducing the price per share to help improve the stock's marketability.
Stop Loss Order: An order to sell a stock if a certain price is reached.
Stop Order: An order to sell at a price below the current market or an order to buy at a price above the current market.
Street Name: Stock kept in the name of the broker instead of the person that actually owns the stock.
Sweetener: Refers to a warrant when attached to a common stock.
Symbol: The abbreviation for a traded company, also known as the company's "ticker".
Syndicate: A group of underwriters or investment brokers that distribute a new or secondary issue of shares.
Tick: Slang term describing the fractional change in the price of a stock.
Takeover: When one company acquires another.
Target Company: The company that is the subject of the take-over attempt.
Trader: Someone who buys or sells stock for his own account to make short term profits.
Tender Offer: A public offer to purchase shares of a company from the existing stockholders.
Thin Market: Usually means very few bids to buy or offers to sell.
Tip: Advice from a friend or acquaintance who supposedly has inside information on the next hot stock.
Unit: A combination of common stocks and warrants.
Uptick: A stock's most recent trade was a higher price than the trade before it. Usually designated with a green arrow.
USD: United States Dollar.
Volatility: A measure of price movement in a stock.
Volume: Usually the number of shares traded for the market or a stock.
Warrant: A certificate that gives the holder the right to buy a stock at a specific price, within a specified time period.
Yield: Return on investment expressed as a percentage of current price. |
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