Home
Stock Basics
Stock Strategies
Trading Demo
Research Options
Online Resources
Glossary
|
- Arbitrary
- Almost on a whim. Sometimes this could involve a decision or opinion based on a gut feeling.
- Appreciate
- Increase in value
- Capital
- Often, the money needed for a venture. Could mean cash. Also refers to the net worth of the company
- Capital gains
- Any profit derived from the sale of an asset. For instance, if you sell a stock for a higher price than you purchased it, that profit is subject to capital gains tax.
- Compounding Interest(Growth)
- Let's say that you put $2000 in the bank in one year and get 10% interest. The next year you also get 10% interest but you get to multiply the $200 interest as well as the $2000 investment. Your interest earned increases because you get interest on interest. If you add $2000 every year, you will have over $1,000,000 in 40 years. Most of this money will be interest. Check it out!
- Day trading
- Watching the market on a daily basis so that one might benefit from a fluctuation in the market.
- Discount broker
- Any broker that markets to average person and charges a reduced commission for trading.
- Dividend
- Profits that a company pays out to its stockholders, usually in the form of cash.
- Dow Jones
- A sample of the largest companies used to determine the overall health of the stock market.
- Federal Reserve Rate
- This is the rate that the Federal Reserve will charge as interest to banks. This figure is often important because it is used to control the availability of money. Banks will generally raise interest rates as this rate rises, or lower their rates if this rate lowers. If the rate is higher, then money is considered to be less available.
- Initial Public Offering (IPO)
- This is the initial release of a company's stocks to the public.
- IRA account Individual Retirement Account.
- This account is important because it is sheltered from taxes until you withdraw the money. This is a great vehicle for investments because it allows you to be taxed at a later date, usually at a reduced rate.
- Limit order
- This is an order to buy or sell stock at a specific price or better. If the price is not met, the order is not executed.
- Market order
- This is your standard order to buy or sell stock.
- The Market
- The stock market.
- Mutual funds
- Some companies will allow you to buy a share of their portfolio. This saves you from having to buy your own stocks. Since these companies can buy more stocks, they have more diversity in their holdings. Another advantage is that with mutual funds, you have full time professionals managing your investments.
- Online trading
- Many sites now allow you to make stock transactions via the Internet for a nominal fee.
- Price earnings ratio (P/E ratio)
- This ratio examines a stock's price to its profit. This ratio is useful for determining the reliability of a stock's price.
- Stock quote
- This includes information regarding the price of the stock. A quote usually includes the opening price, closing price, and amount of change.
- Tandem
- In the same direction at the same time. In other words, if two markets are in tandem, then as one falls, so will the other.
- Value Line
- A useful report that puts all information about a company on one page in a concise report.
|
