Stock Market Terms for Beginners

 

Welcome again to WeGetSavvy's stock market terminology blog, your go-to resource to find out about the jargons related to the world of stock market that you should know. You can be a beginner or someone searching for a jargon related to stock market, this blog is going to be your mini guide. 

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The terms are provided with an easy to understand definition, are presented in a table alphabetically, making it easy to search. So, lets jump into the world of Stock market terminologies.

BROWSE TERMS BY NUMBER:

 

Terms	Definition
Arbitrage	The practice of exploiting price differences
Asset Allocation	Distribution of investments across various assets
Annual Report	A comprehensive report issued by a company annually
Ask Price	The price a seller is willing to accept for a security
Alpha	A measure of an investment’s performance
After-Hours Trading	Trading that occurs after regular market hours
Appreciation	An increase in the value of an asset over time
Annualized Return	The average annual rate of return on an investment
Amortization	The gradual reduction of a debt over time
At-the-Money	An option with a strike price equal to the current market price
Average True Range (ATR)	A measure of market volatility
Accumulation	The process of acquiring an investment gradually over time
American Depository Receipt (ADR)	A negotiable certificate representing shares in a foreign company
Analyst	A financial professional who analyzes stocks and other investments
Auction Market	A market where buyers and sellers interact directly
Absolute Return	The return on an investment without a benchmark comparison
Annual General Meeting (AGM)	A meeting where shareholders discuss and vote on key company decisions
Accredited Investor	An individual or entity meeting certain financial criteria
All-Time High (ATH)	The highest price a security has reached historically
Adjustment	A change in the terms of an option contract
Agency Bond	A bond issued by a government-sponsored agency
Asset-Backed Security (ABS)	A security backed by a pool of assets, such as loans
Asset Bubble	A rapid increase in the price of an asset above its intrinsic value
Allocation	The distribution of investment funds across different assets
At Limit	An order to buy or sell a security at a specific price
Ascending Triangle	A bullish chart pattern forming higher lows and a horizontal resistance line
Acquisition	The process of one company purchasing another company
Allocation Fund	A mutual fund that spreads its investments across various asset classes
Amortization Period	The time it takes to fully repay a loan through regular payments
At Best	An order to execute a transaction at the best available price
Alternative Minimum Tax (AMT)	A tax imposed to ensure that high-income individuals pay a minimum amount
Average Down	The practice of buying additional shares as the price declines
Average Up	The practice of buying additional shares as the price increases
Average Daily Trading Volume (ADTV)	The average number of shares traded per day
Affordability	The ability of a borrower to meet the financial obligations of a loan
Add-On Service	Additional features or services provided with a financial product
Adjustment Bond	A bond whose interest rate adjusts periodically
Aggregate Risk	The total risk exposure of an investor’s portfolio
At the Bell	An order or trade executed at the opening of the market
Average Inflation Rate	The average rate at which prices increase over time
Average Industrial Wage	The average wage earned by workers in a specific industry
Average Out	The process of balancing gains and losses in an investment portfolio
Above the Market	A limit order to buy a security at a price above the current market price
Agency Problem	Conflicts of interest between shareholders and management
Angel Investor	An individual who provides capital for a startup in exchange for ownership equity
Average Daily Balance	The average balance of funds in a financial account over a specified period
Average Annual Return (AAR)	The average annual gain or loss on an investment
Annual Fee	A fee charged annually for maintaining an investment or financial account
Annualized Loss Expectancy (ALE)	The expected loss from a risk event on an annualized basis
After Tax Income	Income remaining after taxes are deducted
Average Collection Period	The average number of days it takes to collect receivables
Average Propensity to Consume (APC)	The percentage of income spent on goods and services
Average Propensity to Save (APS)	The percentage of income saved rather than spent
Average Ticket Size	The average value of individual transactions
Average Earnings	The mean income of a group or population
Average Ticket Price	The average cost of a single unit in a given context
Average Tax Rate	The total tax paid divided by taxable income
After the Bell	Events or transactions that occur after the close of the market
Average Interest Rate	The mean interest rate on a portfolio of financial instruments
Absolute Percentage Growth (APG)	The percentage increase in value from the initial amount
Aftermarket	The secondary market where securities are bought and sold after the initial offering
Allocation Rate	The rate at which an investor allocates funds to different assets
Accumulation/Distribution	A technical analysis indicator measuring buying and selling pressure
After the Close	Events or activities occurring after the close of a trading session
After the Bell	Transactions or events occurring after the close of the market
Absolute Breadth Index (ABI)	A market breadth indicator measuring the percentage of advancing stocks
Average Annual Growth Rate (AAGR)	The average annual rate of growth of an investment over time
After the Fact	Information or analysis provided after an event has occurred
Away from the Market	A trade executed at a price significantly different from
At the Close	Events or activities occurring at the close of a trading session
At the Opening Order	An instruction to execute a trade at the opening of the market
At the Money	An option with a strike price equal to the current market price
Average True Range Percent (ATRP)	A measure of market volatility expressed as a percentage of the stock’s average price
At the Opening	Events or activities occurring at the opening of the market
Average Price Option	The average cost of an options contract
Aged Fail	A situation where a trade settlement fails to occur within the prescribed time frame
American Association of Individual Investors (AAII)	A non-profit organization that provides education and resources to individual investors
Absolute Return Index	An index that measures the absolute return of an investment strategy
Average Up Volume	The average volume of shares traded on an upward price movement
Average Rate of Return (ARR)	The average gain or loss on an investment over a specified period
Agency Costs	Costs incurred due to conflicts of interest between shareholders and management
Average Tax Basis	The average cost of an asset for tax calculation purposes
After-Tax Real Rate of Return	The rate of return on an investment after adjusting for taxes and inflation
Average Down Volume	The average volume of shares traded on a downward price movement
At the Opening Price	The initial price of a security when the market opens
At the Market	An order to execute a transaction at the current market price
Average Portfolio Return	The average return on a portfolio of investments
Average Revenue Per Unit (ARPU)	The average revenue generated per unit of a product or service
Average Option Size	The average number of units in an options contract
Average Strike Price	The average price at which options contracts are exercised or assigned
Average True Range Rating (ATRR)	A measure of market volatility based on the average true range
Average Up Down Volume Ratio	The ratio of average up volume to average down volume in trading
After Tax Rate of Return	The rate of return on an investment after taxes are deducted
After the Bell Market	Events or transactions occurring after the close of the market
Association for Investment Management and Research (AIMR)	A global association providing education and ethical standards for financial professionals
Asset Coverage	The ratio of a company’s net asset value to its outstanding shares
Additional Hedge	An additional investment made to offset potential losses in another investment
American Stock Exchange (AMEX)	A stock exchange in the United States specializing in small and mid-sized companies
Asset Depreciation Range (ADR)	The range of time over which an asset is depreciated for tax purposes
Actual Market Price	The current price at which a security is trading in the market

 

Letter B

Terms	Definition
Bear Market	A market characterized by declining prices and pessimism among investors.
Blue Chip Stocks	Shares of large, stable, and well-established companies with a history of reliable performance.
Bid Price	The highest price a buyer is willing to pay for a security.
Bull Market	A market marked by rising prices and optimistic investor sentiment.
Broker	An individual or firm that facilitates the buying and selling of financial securities on behalf of clients.
Basis Point	One-hundredth of a percentage point, often used in the context of interest rates.
Beta	A measure of a stock’s volatility in relation to the overall market.
Backwardation	A situation where the futures price of a commodity is lower than its spot price.
Breakout	The point at which the price of a security moves above a resistance level, signaling potential upward momentum.
Balance Sheet	A financial statement that shows a company’s assets, liabilities, and shareholders’ equity at a specific point in time.
Buy and Hold	An investment strategy where an investor holds onto a security for the long term, regardless of market fluctuations.
Black Swan	An unpredictable and rare event that has a major impact on financial markets.
Bullish	An optimistic outlook on the market or a specific asset, expecting prices to rise.
Bearish	A pessimistic outlook on the market or a specific asset, expecting prices to fall.
Block Trade	A large quantity of securities being bought or sold, typically in increments of 10,000 shares or more.
Board of Directors	A group of individuals elected by shareholders to oversee the management of a company.
Break-Even Point	The point at which total revenue equals total costs, resulting in neither profit nor loss.
Buyback	The repurchase of a company’s own outstanding shares, reducing the number of shares available in the market.
Bull Call Spread	An options trading strategy involving the purchase of a call option and the simultaneous sale of another call option.
Bear Put Spread	An options trading strategy involving the purchase of a put option and the simultaneous sale of another put option.
Bond	A debt security that represents the issuer’s promise to repay a loan over a specified period with interest.
Brokerage Fee	The fee charged by a broker for executing a trade or providing investment advice.
Book Value	The value of a company’s assets minus its liabilities, often used to assess the intrinsic value of a stock.
Bid-Ask Spread	The difference between the highest price a buyer is willing to pay (bid) and the lowest price a seller is willing to accept (ask).
Bankruptcy	A legal status indicating that an individual or business is unable to repay debts owed to creditors.
Business Cycle	The recurring pattern of economic growth, contraction, and recovery.
Blue Sky Laws	State regulations designed to protect investors from securities fraud by ensuring full and fair disclosure.
Bar Chart	A graphical representation of price movements using vertical bars to indicate open, high, low, and close prices.
Buy Limit Order	An order to purchase a security at or below a specified price.
Buy Stop Order	An order to purchase a security at a price above the current market price.
Basis	The initial price of a security used for tax purposes or to determine capital gains or losses.
Bear Call Spread	An options trading strategy involving the sale of a call option and the simultaneous purchase of another call option.
Buying on Margin	The practice of borrowing funds to buy securities, using the purchased securities as collateral.
Buying Power	The amount of capital available for an investor to make additional trades or investments.
Bottom-Up Investing	An investment strategy that focuses on the analysis of individual stocks rather than broader market trends.
Breakpoint	A level of investment at which the investor becomes eligible for a lower fee or other benefits.
Blue Chip Index	An index comprised of blue-chip stocks, representing the overall performance of large, stable companies.
Basis Risk	The risk that the value of an investment will change due to fluctuations in the underlying benchmark.
Bond Rating	A rating assigned to a bond by credit rating agencies, indicating the issuer’s creditworthiness.
Buyout	The acquisition of a company’s ownership or a significant portion of its assets by another entity.
Bullish Engulfing	A candlestick pattern in technical analysis signaling a potential reversal from a bearish to a bullish trend.
Bearish Engulfing	A candlestick pattern indicating a potential reversal from a bullish to a bearish trend.
Bookrunner	The lead underwriter or manager responsible for organizing and facilitating the issuance of securities.
Bid Size	The number of shares a buyer is willing to purchase at a specific bid price.
Bid Whacker	A trader who places large bids in order to disrupt or manipulate the market.
Bear Trap	A false signal indicating a reversal of a downtrend, luring investors into thinking the trend has reversed.
Bear Market Rally	A temporary upward movement in prices within a bear market, often followed by a continuation of the downtrend.
Bid Tick	A positive change in the last transaction price compared to the previous transaction.
Bond Fund	A mutual fund or exchange-traded fund (ETF) that invests in a diversified portfolio of bonds.
Breakaway Gap	A significant price gap that signals the start of a new trend, often occurring after a consolidation period.
Buy and Write	An investment strategy involving buying a security and writing (selling) options against it to generate income.
Backward Integration	A business strategy where a company acquires or merges with suppliers or production facilities.
Balanced Investment Strategy	An investment approach that seeks to balance risk and return by diversifying across different asset classes.
Bearish Harami	A two-candlestick pattern indicating a potential reversal from a bullish to a bearish trend.
Bullish Harami	A two-candlestick pattern suggesting a potential reversal from a bearish to a bullish trend.
Buying Climax	A rapid and excessive increase in the price of a security, often followed by a reversal or correction.
Bullish Pennant	A continuation pattern in technical analysis, resembling a small symmetrical triangle, indicating a brief consolidation before the previous uptrend continues.
Bearish Pennant	Similar to a bullish pennant but indicates a consolidation before a potential continuation of a downtrend.
Bond Yield	The annual interest earned on a bond expressed as a percentage of its face value.
Buying On Close	Executing a trade at the closing price of the trading session.
Bid Wanted	A notification that a trader is actively seeking bids for a security.
Bearish Abandoned Baby	A candlestick pattern in technical analysis signaling a potential reversal from a bullish to a bearish trend.
Bullish Abandoned Baby	A candlestick pattern indicating a potential reversal from a bearish to a bullish trend.
Buy-In	The purchase of a security to cover a short position when the lender recalls the borrowed shares.
Bank Rate	The interest rate at which a central bank lends money to commercial banks.
Bearish Belt Hold	A single candlestick pattern suggesting a potential reversal from a bullish to a bearish trend.
Bullish Belt Hold	A single candlestick pattern indicating a potential reversal from a bearish to a bullish trend.
Back Months	Futures contracts or options contracts with expiration dates further in the future.
Bull Put Spread	An options trading strategy involving the sale of a put option and the simultaneous purchase of another put option.
Bullish Harami Cross	A two-candlestick pattern indicating a potential reversal from a bearish to a bullish trend.
Bearish Harami Cross	A two-candlestick pattern suggesting a potential reversal from a bullish to a bearish trend.
Buy On Opening	Executing a trade at the opening price of the trading session.
Black-Scholes Model	A mathematical model used to calculate the theoretical price of options.
Brokerage Account	An account held with a brokerage firm that allows an investor to buy and sell financial securities.
Blue Chip	A well-established and financially stable company with a reputation for reliability and quality.
Bullion	Precious metals in the form of bars or coins traded based on their intrinsic metal value.
Blue Chip Stock	Shares of a large, stable, and well-established company with a history of reliable performance.
Bondholder	An individual or institution that holds a bond and is entitled to receive periodic interest payments.
Bull Market Correction	A temporary reversal in the upward trend of a financial market.
Bearish Engulfing Pattern	A candlestick pattern signaling a potential reversal from a bullish to a bearish trend.
Bull Market Top	The peak point of an upward trend in a financial market, indicating a potential reversal to a downtrend.
Beta Coefficient	A measure of a stock’s volatility in relation to the overall market.
Bear Spread	An options trading strategy involving the simultaneous purchase and sale of options with different strike prices.
Big Board	Informal term for the New York Stock Exchange (NYSE).
Bollinger Bands	A technical analysis tool consisting of a set of bands plotted above and below a security’s price.
Bidder	An individual or entity making an offer to buy a security in an auction-style market.
Balance of Trade	The difference between a country’s exports and imports of goods.
Buy-Write	An investment strategy involving buying a security and simultaneously writing (selling) a call option.
Barometer Stock	A stock considered a reliable indicator of the overall market’s direction.
Box Spread	An options trading strategy involving the simultaneous purchase and sale of options with different strike prices and expiration dates.
Back Office	The administrative and support functions of a financial institution, typically handling processing, record-keeping, and settlements.
Bear Hug	A friendly acquisition proposal made by one company to another.
Beneficial Owner	The individual or entity that enjoys the benefits of ownership, even if the title of the security is in another name.
Buy-In Requirement	The amount of money required to cover a buy-in, ensuring the delivery of securities in a short sale.
Blue-Sky Blue Chip	A high-quality stock that meets regulatory requirements for sale in various states, often associated with blue-sky laws.
Bill of Exchange	A written order requiring one party to pay a fixed sum of money to another party at a predetermined future date.
Breakaway	A price movement that “breaks away” from a trading range, often signaling the beginning of a new trend.
Buy-In Notice	A notification sent by a broker to inform a client that their securities must be purchased to cover a short position.
Blue List	A daily publication listing the bid and ask prices of over-the-counter (OTC) stocks.
Basis Quote	A quote in which the price is provided with the basis or differential added or subtracted to determine the actual price.
Bifurcate	To divide or split into two parts, often used in the context of separating financial instruments.
Bellwether	A leading indicator or trendsetter, often used to predict future market or economic trends.
Blue Chip Swap	An interest rate swap involving the exchange of fixed-rate interest payments for floating-rate payments.
Basis Trading	A trading strategy that seeks to profit from the difference in price between related financial instruments.
Bearish Divergence	A situation where the price of an asset is making new highs, but a technical indicator is not confirming the upward movement.
Bullish Divergence	A situation where the price of an asset is making new lows, but a technical indicator is not confirming the downward movement.
Broker Loan Rate	The interest rate at which brokers can borrow money to finance margin loans for their clients.
Bullish Homing Pigeon	A bullish candlestick pattern signaling a potential reversal to the upside.
Bearish Homing Pigeon	A bearish candlestick pattern indicating a potential reversal to the downside.
Bearish Kicker	A bearish reversal pattern where a downtrend is followed by a gap down and a lower close.
Bullish Kicker	A bullish reversal pattern where an uptrend is followed by a gap up and a higher close.
Bottom Line	The net income or profit of a company, often considered the final figure on its income statement.
Bearish Morning Star	A bearish candlestick pattern signaling a potential reversal from an uptrend to a downtrend.
Bullish Morning Star	A bullish candlestick pattern indicating a potential reversal from a downtrend to an uptrend.
Bullish One White Soldier	A bullish candlestick pattern featuring a long white candle that follows a downtrend.
Bearish One Black Crow	A bearish candlestick pattern characterized by a single black candle following an uptrend.
Bullish One Black Crow	A bullish candlestick pattern consisting of a single black candle during a downtrend.
Bullish Piercing Line	A bullish reversal pattern formed by two candlesticks, with the second opening below the first and closing above the midpoint of the first candle.
Bearish Piercing Line	A bearish reversal pattern formed by two candlesticks, with the second opening above the first and closing below the midpoint of the first candle.
Bullish Three White Soldiers	A bullish candlestick pattern featuring three consecutive long white candles, indicating a strong uptrend.
Bearish Three Black Crows	A bearish candlestick pattern consisting of three consecutive long black candles, signaling a strong downtrend.
Bullish Three Black Crows	A bullish candlestick pattern characterized by three consecutive long white candles, indicating a strong uptrend.
Bullish Three Inside Up	A bullish reversal pattern formed by three candlesticks, with the third closing higher than the second and the second closing higher than the first.
Bearish Three Inside Down	A bearish reversal pattern formed by three candlesticks, with the third closing lower than the second and the second closing lower than the first.
Bullish Three Outside Up	A bullish reversal pattern where the third candlestick completely engulfs the range of the previous two candlesticks.
Bearish Three Outside Down	A bearish reversal pattern where the third candlestick completely engulfs the range of the previous two candlesticks.
Bullish Three Stars in the South	A bullish reversal pattern consisting of three small-bodied candlesticks, indicating a potential reversal to the upside.
Bearish Three Stars in the South	A bearish reversal pattern consisting of three small-bodied candlesticks, suggesting a potential reversal to the downside.
Bullish Thrusting Line	A bullish reversal pattern formed by a single white candle that closes near the high and penetrates the midpoint of the prior black candle.
Bearish Thrusting Line	A bearish reversal pattern formed by a single black candle that closes near the low and penetrates the midpoint of the prior white candle.
Bullish Tristar	A bullish reversal pattern consisting of three doji candlesticks, indicating uncertainty in the market.
Bearish Tristar	A bearish reversal pattern consisting of three doji candlesticks, suggesting uncertainty and potential reversal to the downside.
Bullish Tweezer Bottom	A bullish reversal pattern formed by two consecutive candlesticks with equal or nearly equal lows.
Bearish Tweezer Top	A bearish reversal pattern formed by two consecutive candlesticks with equal or nearly equal highs.
Bullish Two Crows	A bullish reversal pattern involving two black candlesticks, followed by a white candlestick that closes above the midpoint of the first black candle.
Bearish Two Crows	A bearish reversal pattern featuring two white candlesticks, followed by a black candlestick that closes below the midpoint of the first white candle.
Bullish Two Hammers	A bullish reversal pattern characterized by two hammer candlesticks, signaling potential upward price movement.
Bearish Two Hammers	A bearish reversal pattern featuring two hanging man candlesticks, indicating potential downward price movement.
Bullish Two Peaks in the South	A bullish reversal pattern consisting of two peaks, indicating a potential trend reversal to the upside.
Bearish Two Peaks in the South	A bearish reversal pattern consisting of two peaks, suggesting a potential trend reversal to the downside.
Bullish Up/Down Gap Side-by-Side White Lines	A bullish continuation pattern formed by two white candlesticks with an up gap between them, indicating a potential continuation of the uptrend.
Bearish Up/Down Gap Side-by-Side Black Lines	A bearish continuation pattern formed by two black candlesticks with a down gap between them, suggesting a potential continuation of the downtrend.
Bullish Upside Gap Two Crows	A bullish continuation pattern involving a white candlestick with an up gap followed by two consecutive black candlesticks, signaling a potential continuation of the uptrend.
Bearish Upside Gap Two Crows	A bearish continuation pattern characterized by a black candlestick with an up gap followed by two consecutive black candlesticks, indicating a potential continuation of the downtrend.
Bullish Upside/Downside Gap Three Methods	A bullish continuation pattern formed by three candlesticks, with a white candle sandwiched between two windows (gaps), indicating a potential continuation of the uptrend.
Bearish Upside/Downside Gap Three Methods	A bearish continuation pattern formed by three candlesticks, with a black candle sandwiched between two windows (gaps), signaling a potential continuation of the downtrend.
Bullish Upside Tasuki Gap	A bullish continuation pattern formed by a white candle with an up gap, followed by a black candle that opens within the previous candle’s body, and a third white candle that closes above the second black candle.
Bearish Upside Tasuki Gap	A bearish continuation pattern involving a black candle with a down gap, followed by a white candle that opens within the previous candle’s body, and a third black candle that closes below the second white candle.
Bullish Volume	A technical analysis term referring to an increase in trading volume accompanying a bullish price movement.

Letter C

Terms	Definition
Candlestick	A charting technique used in technical analysis to represent price movements.
Capital Gain	The profit earned from the sale of an asset. Calculated as the difference between the selling price and the purchase price.
Call Option	A financial contract giving the holder the right to buy an asset at a predetermined price within a specified period.
Candlestick Pattern	A combination of one or more candlesticks used to analyze and predict price movements in technical analysis.
Capitalization	The total market value of a company’s outstanding shares, calculated by multiplying the share price by the number of shares.
Cash Flow	The net amount of cash generated or consumed by a company’s operating, investing, and financing activities.
Commission	The fee paid to a broker for executing a trade on behalf of an investor.
Correction	A reverse movement in the price of a stock, bond, commodity, or market index after a significant uptrend or downtrend.
Close Price	The final price at which a security is traded during a specific trading session.
Cyclical Stock	A stock whose performance is closely tied to economic cycles and tends to move in line with the overall economy.
Circuit Breaker	A mechanism that halts trading temporarily on a stock exchange to prevent excessive volatility.
Collateral	Assets offered by a borrower to a lender as security for a loan.
Conversion Price	The price at which a convertible security can be converted into common stock.
Covered Call	An options strategy where an investor holds a long position in an asset and sells call options on that same asset to generate income.
Call Premium	The price paid by the option buyer to the option seller for the right to buy the underlying security at the strike price.
Coupon Rate	The interest rate paid on a bond, expressed as a percentage of the face value.
Capital Market	A financial market where long-term securities, such as stocks and bonds, are bought and sold.
Cyclical Industry	An industry whose performance is closely tied to economic cycles.
Cost of Goods Sold (COGS)	The direct costs associated with the production of goods sold by a company.
Counterparty	The other party in a financial transaction, with whom an agreement has been made.
Closing Bell	The end of the trading day on a stock exchange, marked by the sounding of a bell.
Currency Risk	The risk of financial loss due to fluctuations in exchange rates.
Cash Market	The market where financial instruments are traded for immediate delivery and payment.
Common Stock	A type of equity representing ownership in a company and giving shareholders voting rights.
Clearing House	An intermediary that facilitates the settlement of trades between buyers and sellers.
Continuous Trading	The process of buying and selling securities throughout the trading day without interruption.
Current Ratio	A financial ratio that measures a company’s ability to cover its short-term liabilities with its short-term assets.
Capital Structure	The mix of a company’s long-term debt, specific short-term debt, common equity, and preferred equity.
Contingent Order	A type of order that is executed only if certain conditions are met.
Cash Dividend	A payment made by a company to its shareholders, usually in the form of cash.
Cost Basis	The original value of an asset for tax purposes, adjusted for stock splits, dividends, and other factors.
Cross Rate	The exchange rate between two currencies that do not involve the U.S. dollar.
Commodity	A physical or virtual item traded on a commodity exchange, such as gold or oil.
Capital Expenditure (CapEx)	Funds used by a company to acquire, upgrade, and maintain physical assets.
Candlestick Chart	A type of financial chart used to represent price movements in technical analysis.
Cash Settlement	A method of settling futures and options contracts where the seller delivers cash instead of the underlying asset.
Call Money	Short-term loans provided by banks to brokerage firms to cover margin requirements.
Cup and Handle	A bullish continuation pattern in technical analysis, often seen in price charts.
Consolidation	A period of sideways or non-trending price movement on a price chart.
Currency Pair	The two currencies being compared in a foreign exchange rate.
Call Market	A market where all participants can submit their orders to be executed at a specific time.
Commodity Futures	Contracts to buy or sell a specific amount of a commodity at a future date for a predetermined price.
Currency Swap	An agreement between two parties to exchange one currency for another and reverse the exchange at a later date.
Convertible Bond	A type of bond that can be converted into a predetermined number of shares of the issuer’s common stock.
Cost Averaging	An investment strategy where the same amount is invested at regular intervals, regardless of the asset’s price.
Ceiling Price	The maximum allowable price, often used in government price controls.
Cash Equivalents	Short-term, highly liquid investments that are easily convertible to known amounts of cash.
Closing Range	The difference between the highest and lowest prices at which a security trades during a specific period.
Capital Stock	The total amount of common and preferred stock that a company can issue.
Clearing Fee	A fee charged by a clearinghouse for clearing and settling trades.
Capitulation	A point where investors give up their positions, often marking a potential reversal in the market trend.
Conversion Ratio	The number of common shares received for each convertible security.
Candlestick Analysis	A method of technical analysis that uses candlestick patterns to predict price movements.
Collar	An options strategy involving the purchase of a put option and the sale of a call option.
Cross Listing	The listing of a company’s stock on multiple stock exchanges.
Cash Market Price	The current market price of a financial instrument available for immediate settlement.
Convertible Preferred Stock	Preferred stock with an option for the holder to convert it into a specified number of common shares.
Calendar Spread	An options trading strategy involving the simultaneous purchase and sale of options with different expiration dates.
Credit Rating	An assessment of the creditworthiness of a borrower, usually expressed in letter grades.
Currency Depreciation	A decrease in the value of one currency relative to another.
Collateralized Debt Obligation (CDO)	A complex financial product created by bundling various debt instruments into a single security.
Closing Auction	A trading session at the end of the trading day where all trades are conducted at a single price.
Cumulative Dividend	A dividend payment that accumulates and is not paid when scheduled, leading to future payment obligations.
Counterparty Risk	The risk that the other party in a financial transaction will default on their obligations.
Commodity Channel Index (CCI)	A momentum indicator used in technical analysis to identify overbought or oversold conditions.
Call Option Premium	The price paid by the buyer of a call option to the seller for the right to purchase the underlying asset.
Capital Allocation	The process of distributing a company’s financial resources among different business units or projects.
Current Yield	The annual income generated by an investment, expressed as a percentage of its current market price.
Contract Month	The month in which a futures or options contract expires.
Coupon Payment	The periodic interest payment made to the bondholders based on the bond’s face value and coupon rate.
Cross Margining	The use of a single margin account to trade in multiple markets or asset classes.
Cyclical Stock	A stock whose price is influenced by economic cycles.
Central Bank	A financial institution responsible for regulating a country’s money supply and monetary policy.
Current Market Value (CMV)	The present value of an investment based on its current market price.
Clean Price	The price of a bond without including any accrued interest.
Cash Flow Statement	A financial statement that provides information about a company’s cash inflows and outflows over a specific period.
Call Spread	An options trading strategy that involves buying and selling call options on the same underlying asset.
Collateralized Mortgage Obligation (CMO)	A type of mortgage-backed security that separates mortgage pools into different risk classes.
Central Limit Order Book	An electronic system that matches buy and sell orders for financial instruments.
Close Order	An order to buy or sell a security at the market price when the market closes.
Capital Gain Tax	The tax imposed on the profit earned from the sale of a capital asset.
Contingent Value Rights (CVR)	Securities that may be issued to shareholders in certain corporate events, such as mergers or acquisitions.
Currency Peg	A government’s decision to tie the value of its currency to another currency or a basket of currencies.
Contingent Deferred Sales Charge (CDSC)	A fee charged on the sale of mutual fund shares if redeemed within a specific period.
Commodity Index	An index that measures the performance of a basket of commodities.
Crossover	A technical analysis pattern where an asset’s price crosses a specific threshold, signaling a potential trend reversal.
Current Ratio	A financial ratio that compares a company’s current assets to its current liabilities.
Capitalization Rate	The ratio of a property’s net operating income to its current market value.
Callable Bond	A bond that allows the issuer to redeem it before maturity.
Closed-End Fund	A type of investment fund with a fixed number of shares that are traded on a stock exchange.
Correlation	A statistical measure that quantifies the degree to which two variables move in relation to each other.
Cost of Capital	The average rate of return required by investors to invest in a company.
Cup With Handle	A bullish continuation pattern in technical analysis, resembling the shape of a tea cup.
Closing Price	The last trading price of a security at the end of a trading session.
Credit Risk	The risk of financial loss due to the failure of a borrower to meet their debt obligations.
Commodity ETF	An exchange-traded fund that invests in physical commodities or commodity futures contracts.
Coupon Stripping	The process of separating the interest and principal components of a bond to create zero-coupon bonds.
Cryptocurrency	A digital or virtual currency that uses cryptography for security and operates on decentralized networks.
Cumulative Preferred Stock	A type of preferred stock where unpaid dividends accumulate and must be paid before common stock dividends.
Currency Forward Contract	A financial instrument that obligates two parties to exchange a specified amount of currency at a future date and agreed-upon exchange rate.

 

Letter D

 

Terms	Definition
Day Trading	A trading strategy where traders buy and sell financial instruments within the same trading day, closing all positions before the market closes.
Dividend	A portion of a company’s profits distributed to its shareholders, usually in cash or additional shares.
Dow Jones Industrial Average (DJIA)	An index that measures the performance of 30 large, publicly-owned companies listed on stock exchanges in the United States.
Derivative	A financial instrument whose value is derived from the value of an underlying asset, index, or rate.
Debt Market	The market where debt instruments, such as bonds, are bought and sold.
Dilution	The reduction in the ownership percentage of existing shareholders due to the issuance of new shares.
Dividend Yield	A financial ratio that shows the annual dividend income as a percentage of a company’s stock price.
Dark Pool	A private forum or exchange for trading securities away from the public eye, often used by institutional investors.
Debt-to-Equity Ratio	A financial ratio that compares a company’s total debt to its shareholders’ equity.
Direct Listing	A process for a private company to become publicly traded without an initial public offering (IPO).
Dividend Aristocrat	A company with a long history of consistently increasing its dividend payments.
Double Bottom	A technical analysis pattern on a price chart that signals a potential reversal of a downtrend.
Dividend Payout Ratio	The percentage of a company’s earnings paid out as dividends to shareholders.
Dividend Reinvestment Plan (DRIP)	A program that allows shareholders to automatically reinvest their cash dividends into additional shares of the issuing company.
Day Order	An order to buy or sell a security that is valid only for the trading day on which it is placed.
Debt Security	A financial instrument representing a loan made by an investor to an issuer, such as a government or corporation.
Debt-to-Income Ratio	A financial ratio that compares a person’s debt payments to their overall income.
Dead Cat Bounce	A temporary recovery in the price of a declining security, followed by a continuation of the downtrend.
Dividend Declaration Date	The date on which a company’s board of directors announces the upcoming dividend payment.
Dividend Ex-Date	The first day a stock trades without the dividend, determining which shareholders are eligible to receive it.
Dividend Imputation System	A tax system where some or all of the tax paid by a company is attributed to the shareholders when they receive dividends.
Dividend Stock	A stock known for its regular and often increasing dividend payments.
Dividend Tax	The tax imposed on dividend income received by shareholders.
Dividend Voucher	A document provided to shareholders as proof of the dividends they have received.
Dark Cloud Cover	A bearish candlestick pattern that may signal a potential reversal of an uptrend.
Debt Ceiling	The maximum amount of money that a government is allowed to borrow to cover its expenses.
Dividend Frequency	The regularity with which a company pays dividends, such as monthly, quarterly, or annually.
Dividend Growth Investing	An investment strategy focused on selecting stocks with a history of consistent dividend growth.
Dividend Irrelevance Theory	A financial theory stating that a company’s dividend policy does not affect its value.
Dividend Record Date	The date on which a shareholder must be registered to receive a declared dividend.
Dividend Tax Credit	A tax credit given to certain investors based on the taxes a company has already paid on its earnings.
Dividend Yield Curve	A graphical representation of the relationship between a bond’s yield and its time to maturity.
Dividend Cover Ratio	A financial ratio that measures a company’s ability to pay dividends from its earnings.
Dividend Cut	A reduction in the amount of dividends paid by a company to its shareholders.
Dark Web	A part of the internet that is intentionally hidden and accessible only through specific software, often associated with illegal activities.
Discretionary Income	The amount of money left after deducting essential living expenses from total income, available for non-essential spending.
Dividend Yield Trap	A situation where a high dividend yield may be unsustainable, leading to potential risks for investors.
Dividend Discount Model (DDM)	A valuation method that calculates the present value of expected future dividends to determine the intrinsic value of a stock.
Dividend Earnings Ratio	A financial ratio that compares a company’s dividends per share to its earnings per share.
Dividend Growth Rate	The percentage increase in a company’s dividend payments over a specific period.
Dividend Index Fund	An investment fund that aims to track the performance of a dividend-focused stock index.
Dividend Multiplier	A valuation metric that compares a company’s stock price to its dividends per share.
Dividend Reinvestment	The practice of using dividends to purchase additional shares of the same stock, automatically reinvesting the earnings.
Dividend Aristocrats Index	An index consisting of S&P 500 companies with a history of consistently increasing dividends.
Dividend Sustainability	The ability of a company to maintain or increase its dividend payments over the long term.
Dividend Adjusted PEG Ratio	A modified version of the PEG ratio that accounts for a company’s dividend payments.
Dividend Swap	A financial derivative that allows investors to exchange future cash flows based on dividend payments.
Dividend Cash Flow Model	A valuation model that estimates the intrinsic value of a stock based on its expected future cash flows, including dividends.
Dividend Declaration	The formal announcement by a company’s board of directors approving the payment of a dividend.
Dividend Equivalent Swap	A financial contract that allows an investor to gain exposure to the dividend income of a specific stock.
Dividend Franking	The practice of attaching imputation credits to dividends to avoid double taxation on corporate profits.
Dividend Investing	An investment strategy focused on selecting stocks that pay regular and increasing dividends.
Dividend Payout	The portion of a company’s earnings distributed to shareholders in the form of dividends.
Dividend Period	The interval between two consecutive dividend payments made by a company.
Dividend Policy	The strategy or approach a company follows in deciding how much of its
Dividend Reversal	A situation where a company, after a period of not paying dividends, starts paying them again.
Dividend Swap Ratio	The ratio at which cash and stock are exchanged in a dividend swap.
Dividend Tax Exemption	A tax provision that exempts a certain portion of dividend income from taxation.
Dividend Tracker	A tool or system that helps investors monitor and track dividend payments from their investments.
Dividend Unit	A unit representing a portion of a mutual fund’s dividend income, distributed to unit holders.
Dark Trading	The practice of trading financial instruments outside of public exchanges, often in private markets.
Dividend Withholding Tax	A tax deducted at the source on dividend payments made to foreign investors.
Duration	A measure of the sensitivity of a bond’s price to changes in interest rates.
Dividend Yield ETF	An exchange-traded fund that focuses on investing in stocks with attractive dividend yields.
Dividend Zero Coupon Bond	A type of zero-coupon bond that pays no interest until maturity, at which point it provides a lump sum payment.
Diluted Earnings Per Share (Diluted EPS)	A financial metric that represents a company’s earnings per share, considering potential dilution from convertible securities.
Debt Financing	Raising capital by borrowing money through loans or issuing bonds.
Dividend Yield Percentage	The annual dividend income as a percentage of a company’s current stock price.
Dividend Aristocrats ETF	An exchange-traded fund that tracks an index composed of companies with a history of consistently increasing dividends.
Debt Service	The total amount of debt principal and interest payments a borrower must make over a specific period.
Dividend Discounted Total Return (DDTR)	A measure that combines the impact of dividend income and stock price appreciation on total return.
Dividend Efficiency Ratio	A ratio that assesses a company’s ability to generate profits and pay dividends efficiently.
Dividend Equivalent Yield	A measure that calculates the yield on a stock when accounting for taxes on dividend income.
Dividend Growth Investing Strategy	An investment approach focused on selecting stocks with a track record of consistently growing dividends.
Dividend Impact on Option Pricing	The effect of expected dividend payments on the pricing of options.
Dividend Irrelevance Proposition	A financial theory asserting that a company’s dividend policy has no impact on its market value.
Dividend Level Model	A valuation model that determines the fair value of a stock based on the present value of expected future dividends.
Dividend Note	A financial instrument representing a promise to pay a future sum based on a company’s dividend payments.
Dividend Payout Model	A model that estimates a company’s dividend payments based on its earnings and retention ratio.
Dividend Per Share (DPS)	The amount of cash paid to shareholders for each outstanding share of stock, representing a portion of the company’s profits.
Dividend Reinvestment Provision	A feature in a dividend reinvestment plan (DRIP) that allows participants to buy additional shares at a discount.
Dividend Risk	The potential for a company to reduce or eliminate dividend payments due to financial challenges or other factors.
Dividend Scaling	The adjustment of dividend payments based on the number of shares outstanding or other factors.
Dividend Signaling	The use of dividend policy by companies to convey information about their financial health and future prospects.
Dividend Stock Index	An index that tracks the performance of a portfolio of dividend-paying stocks.
Dividend Tax Credit Ratio	The proportion of a dividend that qualifies for a tax credit, reducing the tax liability for the recipient.
Dividend Total Return	The total return on an investment, including both capital appreciation and dividend income.
Dividend Unitization	A process that converts dividend income into units, facilitating easy distribution to investors.
Dividend Warrant	A financial instrument that grants the holder the right to receive future dividend payments from a company.
Dividend Yield Net of Tax	The after-tax yield on a stock’s dividend, considering the impact of taxes on the income.
Dividend Accumulation Plan	A plan that allows shareholders to accumulate cash dividends and reinvest them in additional shares.
Dividend Booster	A company that consistently increases its dividends, providing a boost to shareholder income over time.
Dividend Clawback	The reduction or elimination of previously declared dividends by a company, often due to financial difficulties.
Dividend Coverage Ratio	A financial ratio that assesses a company’s ability to cover its dividend payments with earnings.
Dividend Declaration Window	The period during which a company’s board of directors declares the payment of upcoming dividends.
Dividend Efficiency	A measure of how efficiently a company converts its earnings into dividend payments.
Dividend Equity Swap	A financial derivative that allows an investor to gain exposure to a stock’s future dividend income.
Dividend Frequency Ratio	A ratio that compares the frequency of a company’s dividend payments to its overall earnings.
Dividend Growth Model	A model that estimates a company’s stock price based on its expected future dividend growth.
Dividend Harmonization	The alignment of dividend payment schedules among different classes of shares issued by a company.

 

Letter E coming soon…