ABC  

Elliott wave terminology for a three-wave countertrend price movement. Wave A is the first price wave against the trend of the market while Wave B is a corrective wave to Wave A. Wave C is the final price move to complete the countertrend price move. Elliott wave followers study A and C waves for price ratios based on numbers from the Fibonacci series.

 Abnormal Return

Abnormal return is measured as the difference between actual return and expected return. Cumulative Abnormal Return or CAR is the sum of abnormal returns calculated over the period which includes the announcement and the publication of the information, as well as some time both before and after that event.

 Account

There are several types of accounts that most brokers offer: Cash Account, Margin Account, Option Account (for option trading), Custody Account (this account gives power of attorney), IRA Account, Joint Account, etc.

 Account Statement

Contains data on transactions and states the current condition of the client’s account over a certain period of time.

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 Accumulation

An addition to a trader's original market position. The first of three distinct phases in a major trend in which investors are buying.

 Accumulation/Distribution Line

See Chaikin Oscillator

 Active Management

The main benefit of an active investment strategy is the potential for higher returns. An active manager can profit from market trends since he may choose amongst the most promising securities and sectors.

 Active Portfolio

In the context of the Treynor-Black model, this is a portfolio that contains analyzed stocks, non-zero alphas and passive portfolio of the market index.

 Adaptive Filter  

Smoothing or forecasting prices with continuously updated weighting of past prices.

 Adjusted Forecast

A micro or macro forecast which is adjusted in order to minimize the inaccuracy of forecasting.

 Adverse Excursion

The loss attributable to price movement against the position in any one trade.

 After Hour Trading

The practice of buying and selling stocks or indexes after official trading hours.

 All or None

Used on a buy or sell order to instruct the broker to fill the order completely or not at all.

 Alpha

Premium that an investment portfolio earns above a given point of reference which exceeds the one that can be forecasted using the CAPM or APT model.

 American Depository Receipts (ADR)

Certificates that are issued by a bank of US origin and traded in the U.S. as domestic shares. The certificates represent the foreign securities that the bank holds in that security's country of origin.

 American option, European option

An American option can be exercised at any time up to the maturity date, unlike the European option, which can only be exercised at maturity.

 Annual Earnings Change (%) 

The historical earnings change between the most recently reported fiscal year earnings and the preceding.

 Annual Net Profit Margin (%)

The percentage that the company earned from gross sales for the most recently reported fiscal year.

 Appraisal Ratio

A signal/noise ratio in the forecasts. A ratio between the Alpha and "Residual Standard Deviation".

 Appreciation

Increase in the value of a currency relative to another.

 APR

(Аnnual Percentage Rate)

Annual percentage rate.

 Arbitrage

The simultaneous purchase and sale of two different, but closely related, securities to take advantage of a disparity in their prices.

 Arbitrage Pricing Theory

Arbitrage Pricing Theory is based on the Factor Model, emphasizing diversification and arbitrage arguments. The theory describes the dependency between the expected asset returns.

 Artificial Intelligence

The branch of computer science concerned with the development of programs that attempt to mimic the processes of the human brain.

 Ask/Offer

The price at which the market is prepared to sell a specific currency.

 Asked Price

The price at which the market maker is willing to sell a stock.

 Asset Allocation

Dividing instrument funds (stocks, bonds) among markets to achieve diversification or maximum return.

 Asset Turnover (ATO)

The ratio of net sales to total assets generated for every dollar's worth of assets.

 Auction Market

A market where buyers and sellers enter simultaneous bids and offers such as the New York Stock Exchange (NYSE).

 Aussie

A market term for the Australian Dollar.

 Auto Regressive Integrated Moving Average (ARIMA)

A linear stochastic model forecasting methodology described by Box and Jenkins in their book Time Series Analysis, Forecasting and Control.

 Autocorrelation

The correlation between the values of a time series and previous values of the same time series.  The extent to which the trader’s profit/loss ratio is dependent on his work over certain periods of time.

 ATS - Alternative Тrading Systems

The most innovative segment of the stock market represented by electronic communication networks (ECNs) which provide investor with faster and cheaper access to markets. The most famous alternative trading systems are Instinet, SOES, Island, SelectNet, Terra Nova, etc.

 Average collection period, or days’ receivables

The ratio of accounts receivables to daily sales, or the total amount of credit extended per dollar of daily sales.

 Average Directional Movement Index (ADX)

Indicator developed by J. Welles Wilder to measure market trend intensity.

 Averaging

A method used by stock market investors and speculators to optimize the average price of securities in the trader’s portfolio.  “Averaging down” means to buy more stock of a given issue at a price less than the last purchase successively as the price declines.  “Averaging up” means to buy more of a given security at successively higher prices as prices advance.

 Bank Discount Yield

An annualized interest rate assuming simple interest, a 360-day year, and using the face value of the security rather than purchase price to compute return per dollar invested.

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 Banker’s Acceptance

A money market asset consisting of a customer's order to a bank to pay a sum of money at a future date.

 Bar Chart

A type of chart which shows the price movements of a market asset over a certain period of time. The high and the low prices form the vertical bar, the opening price forms the horizontal line to the left of the bar, and the closing price forms the horizontal line to the right of the bar.

 Base Currency

The base currency is the first currency in a currency pair, and the currency that remains constant when determining a currency pair's price. For example, currency pairs against the USD will be identified as USD/BGN, where USD is the base currency.

 Basis

The difference between the spot price and the futures price.

 Basis Point

One hundredth of a percentage point.

 Basis Risk

The risk associated with an unexpected widening or narrowing of basis (i.e. the difference between the futures price and the spot price).

 Bear

Investor acting on the belief that prices or the market will decline. (Opposite of Bull).

 Bear Market

A market in which prices decline sharply against a background of widespread pessimism.

 Benchmark Error

Use of an inappropriate proxy for the true market portfolio.

 Beta

A measure of the systematic risk associated with any given security in the market. A ratio of an individual's stock historical returns to the historical returns of the stock market.

 Bid

The highest price an investor is willing to pay to buy a security.

 Bid-Asked Spread

The difference between the bid and asked prices.

 Bid-Offer Spread

The difference between the buy (bid) and sell (offer) price of a currency or financial instrument.

 Big Figure

Dealer expression referring to the first few digits of an exchange rate.

 Binomial Model

The binomial options model provides a generalisable numerical method for the valuation of options. The model differs from other option pricing models, in that it uses a “discrete-time” model of the varying price over time of financial instruments.

 Black-Scholes Formula

A formula developed to estimate the market value of option contracts which includes the stock price, the exercise price, the risk-free interest rate, the expiry date, as well as the standard deviation from the return on securities.

 Block House

Brokerage firms that help to find potential buyers or sellers of large block trades.

 Block Sale

A transaction of more than 10,000 shares of stock.

 Block Transactions

Large transactions in which at least 10,000 shares of stock are bought or sold. Brokers or "block houses" often search directly for other large traders rather than bringing the trade to the stock exchange.

 Bogey

The return an investment manager is compared to for performance evaluation.

 Bollinger Bands

An indicator that allows users to compare volatility and relative price levels over a period time. Since the band width is a function of standard deviation, assets with greater volatility will have wider bands. A move outside the band indicates that the trend is strong and likely to continue.

 Bond

Bonds are issued by governments, companies and other entities and individuals in return for cash from lenders and investors. The borrower pays interest to the lender or investor through the life of the bond.

 Bond Equivalent Yield

Bond yield calculated on an annual percentage rate method. Differs from annual effective yield.

 Book Value

The net value of a company's assets, less its liabilities and the liquidation price of its preferred issues. The net asset value divided by the number of shares of common stock outstanding equals the book value per share, which may be higher or lower than the stock's market value.

 Break-Even Point

Refers to the price at which a transaction produces neither a gain nor a loss.

 Breakout

The point when the market price moves out of the trend channel (previous high or low, consolidation level).

 Broker

An agent who executes the public's orders for the purchase or sale of securities or another instrument for a fee or commission.

 Broker-Dealer

A firm that handles transactions for its customers and also purchases securities for its own account, selling them to customers.

 Brokered Market

A market where an intermediary (a broker) offers search services to buyers and sellers.

 Bull

Investor acting on the belief that prices or the market will rise. (Opposite of Bear).

 Bull CD, Bear CD

A bull CD pays its holder a specified percentage of the increase in return on a specified market index while guaranteeing a minimum rate of return. A bear CD pays the holder a fraction of any fall in a given market index.

 Bull Market

A securities market characterized thus on rising prices.

 Bullish, Bearish

Words used to describe investor attitudes. Bullish means optimistic; bearish means pessimistic. These terms also describe the bull market and bear market.

 Bundling, Unbundling

A trend allowing creation of securities either by combining primitive and derivative securities into one composite hybrid or by separating returns on an asset into classes.

 Business Cycle

The recurrent rise and fall of a country's economic fortune over time. It is characterized by fluctuating employment levels, industrial productivity, and interest rates.

 Buy-and-hold approach

An investment strategy in which stocks are bought and then held for a long period, regardless of the market's fluctuations. The buy-and-hold approach to investing in stocks and mutual funds rests upon the assumption that in the very long term stock prices will go up.

 Buy Limit

Indicates a security may be purchased only at the designated price or lower.

 Buy Stop

A buy order not to be executed until the market price rises to the stop price. Once the security has broken through that price, the order is then treated as a market order.

 Cable

Common terminology for the British Pound against the US dollar exchange rate.

 Call Option

A contract that gives the buyer of the option the right but not the obligation to take delivery of the underlying security at a specific price within a certain time.  American options can be exercised at any time up to the expiration date while  European Options can be exercised only on the expiration date.

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 Call rate

The primary or the base size of credit provided by broker. The actual size of the credit is usually defined as a premium/discount expressed as percentages or basis points to the primary size depending on the size and the type of the credit.

 Candlestick Chart

A type of chart which shows the price movements of a market asset over a certain period of time. The high and low are plotted as a single line and are referred to as shadows. The price range between the open and the close is plotted as a narrow rectangle and is referred to as the body. If the close is above the open, the body is white. If the close is below the open, the body is black.

 Capital Gains

The amount by which the ask price of a security exceeds the bid price.

 Capital Markets

Markets for medium and long term investment.

 Cash Flow

Reported net income of a corporation plus amounts charged off for depreciation, depletion, amortization, and extraordinary charges to reserves, which are bookkeeping deductions and not paid out in actual dollars and cents.

 Chaikin Oscillator 

Oscillator created by subtracting a 10-day from a 3-day EMA of accumulation/distribution line.

 Channel

In charting, a price channel contains prices throughout a trend. There are three basic ways to draw channels: parallel, rounded and channels that connect lows (bear trend) or highs (bull trend).

 Chaos Theory

Describes the behavior of nonlinear systems. A subset of nonlinear dynamics analysis, chaos theory is a branch of mathematics focusing on irregular and complex behavior that has an underlying order. In the stock market, chaos theory seeks to forecast the future path of stock prices, including sudden changes that occur during periods of intense market activity.

 Chart

A display or picture of a security that plots price and/or volume .

 Chartist

An individual who studies graphs and charts of historic data to find trends and predict trend reversals which include the observance of certain patterns and characteristics of the charts.

 Clearing house

Established by exchanges to facilitate transfer of securities resulting from trades. For options and futures contracts, the clearinghouse may interpose itself as a middleman between two traders.

 Close

The performance of a reverse operation for an already open position. The “Sell” position is closed by buying while the “Buy” position is closed by selling.

 Closed end (mutual) fund

A closed-end mutual fund sells a limited number of shares, which usually trade on a stock exchange. Shares of closed-end funds routinely trade at a discount or premium to NAV.

 Closed Position

The net zero position relative to a certain currency or an instrument.

 Closed Trades

Positions that have been either liquidated or offset.

 Close a Position/ Position Squaring

To eliminate an investment from one’s portfolio by either buying back a short position or selling a long position.

 Closing Price

At the end of a trading session, the price of the final trade in a security.

 Cold calling

A system of placing calls to people on a list taken from the telephone book or some other source. The caller is phoning people they don't know in the hopes of making a sale.

 Commission

A fee charged by a broker for buying or selling securities on behalf of a client.

 Commission Broker

A broker on the floor of an exchange who executes the public's orders for the purchase or sale of securities or commodities.

 Commodity

A commodity is good that is generally a primary good used in manufacturing such as timber, cotton, wool and copper.

 Commodity Channel Index

Developed by Donald Lambert, the CCI measures the variation of an instrument's price from its mean.

 Common Stock

Securities that represent an ownership interest in a corporation. Shareholders have the right to vote on major decisions. Holders of common stock shares are last in line in terms of their claim to dividends, assets, etc.

 Complete Portfolio

The entire portfolio, including risky and risk-free assets.

 Confirmation

The written or oral statement by a broker that follows any "trade" in the securities markets. Confirmation is issued immediately after a trade is executed. It spells out settlement date, terms, commission, etc.

 Consolidation

Consolidation (sideways trend) is usually referred to as a series of trading days in which no significant change in price occurs.

 Consumer Price Index

The gauge of US inflation.

 Contracts for Difference (CFD's)

CFD’s allow you to take positions on share prices without needing to buy and sell shares themselves.

 Contrarian

An investor who does the opposite of what most investors are doing at any particular time. There are two possible reasons this strategy might work. The first is a mean-reversion argument; that is, if the asset has deviated from its usual level, it should eventually return to that usual level. The second reason has to do with overreaction. Investors might have overreacted to bad news sending the asset price lower than it should be.

 Convertible Currency

A currency that can be freely exchanged for another currency (and or gold) without special authorization from the central bank.

 Correction

Any price reaction within the market leading to an adjustment by as much as one-third to two-thirds of the previous gain.

 Correction Wave

A wave or cycle of waves moving against the current impulse trend's direction.

 Correlation Coefficient

Degree to which two series of numbers plot as a straight line. A correlation coefficient of 1 (or -1) indicates that the two series of numbers plot exactly along a straight line.

 Country Risk

General level of political, financial, and economic uncertainty in a country.

 Credit Risk

A measure of a bond issuer's ability to repay its principal and interest as promised.

 Cross Hedge

Hedging a cash position in one commodity or financial instrument by initiating a position in a futures contract for a different but related commodity or instrument.

 Cross Rate

The price of one foreign currency expressed in relation to another foreign currency other than the U.S. dollar.

 Cumulative Volume Index  

The Cumulative Volume Index uses market momentum to illustrate money flows in and out of the market. It is calculated by subtracting the volume of declining stocks from the volume of advancing stocks and adding this resulting value to a running total.

 Cup With Handle

A bullish chart pattern that marks a consolidation period followed by a breakout. The "cup" part of the pattern resembles a rounding bottom, and is followed by a "handle" that acts as a final consolidation before a break.

 Currency Risk

The risk of an investments value changing because of currency exchange rates.

 Currency Selection

Asset allocation in which the investor chooses among investments denominated in different currencies.

 Currency Swap

The simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate.

 Current Account

Net flow of goods, services, and unilateral transactions (gifts) between countries. A country's balance of payments includes current account and capital account.

 Current Ratio

The current assets of a company divided by its current liabilities. Indicator of short-term debt-paying ability. Determined by dividing current assets by current liabilities. The higher the ratio, the more liquid the company.

 Datafeed         

The supply of information (quotes, news), typically supplied real time, via a continuous feed.

 Data vendors

Commercial companies which sell data, quotes (either historical or real time), analyst reports, etc.

 Day Order

An order to buy or sell that, if not executed, expires at the end of trading day on which it was entered.

 Day Trading

Refers to establishing and liquidating the same position or positions within the same trading session.

 Dead Cat Bounce

A small upmove in a bear market.

 Dealer

An individual or firm who buys and sells stocks and bonds as a principal rather than as an agent.

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 Dealer Market

Where trader`s specializing in particular commodities buy and sell assets for their own accounts. For example, the OTC market.

 Delay

The amount of time that elapses between a change in an input event and the resultant change in a related output event or time series.

 Deposit

The borrowing and lending of cash.

 Derivatives

Trades that are constructed or derived from another security (stock, bond, currency, or commodity). Examples of derivative instruments include Options, Interest Rate Swaps, etc.

 Diamonds DIA

Shares in an ETF, Diamonds Trust Series I, that track the Dow Jones Industrial Average. The fund is structured as a unit investment trust.

 Direct Quotation

Quoting in fixed units of foreign currency against variable amounts of the domestic currency. For example, USD/BGN.

 Discount Rate

The interest rate central banks charge their member banks for loans.

 Divergence

When two or more indicators, indexes, or averages, fail to show confirming trends.

 Diversification

Dividing investment funds among a variety of securities with different risk, reward, and correlation statistics so as to minimize unsystematic risk.

 Dividends

A payment made by a company to its shareholders that is a portion of the profits of the company.

 Doji

A single candle that opens and closes at the same price and is the ultimate form of a spinning top. Usually a sign of indecision and turning point.

 Double Bottom

A term used in technical analysis to refer to the drop of a stock`s price, a rebound, and then a drop back to the same level as the original drop.

 Double Top

A term used in technical analysis to refer to the rise of a stock`s price, a drop, and then a rise back to the same level as the original rise.

 Dow Jones Industrial Average (DJIA)

The most widely recognized market indicator, made up of 30 large and actively traded industrial stocks.

 Dow Theory

A method of predicting share price trends by identifying primary trends from historic share price data.

 Downtick

A Down tick is when the last trade in a security is a price lower than the previous.

 Downtrend

A deflation of prices.

 Drawdown

Reduction in account еquity from a trade or series of trade.

 Due diligence

An investigation or audit of a potential investment. Due diligence (DD) serves to confirm all material facts in regards to a sale. Offers are usually made dependent upon the due diligence. Includes all financial records plus anything else deemed material to the sale.

 Duration

A common gauge of the price sensitivity of a fixed income asset or portfolio to a change in interest rates.

 Dynamic Data Exchange

A method of exchanging data between applications. It enables multiple applications to have access to the same data. Changes made in either application to the data are reflected in the main document.

 EAFE Index

EAFE refers to Europe, Australia and the Far East. The index, which is compiled by Morgan Stanley, is an aggregate of 21 individual country indexes that collectively represent many of the major markets of the world.

 Economic Earnings

The real flow of cash that a firm could pay out forever in the absence of any change in the firm's productive capacity.

 Economic Indicator

An economic measure used to determine economic growth. Examples include GDP, Consumer Price Index, Money Supply, Trade Balance, Unemployment Rate, etc.

 Efficient Diversification

The organizing principle of modern portfolio theory, which maintains that any risk-averse investor will search for the highest expected return for any particular level of portfolio risk.

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 Efficient Market Hypothesis (EMH)

In general the hypothesis states that all relevant information is fully and immediately reflected in a securitys market price thereby assuming that an investor will obtain an equilibrium rate of return. In other words, an investor should not expect to earn an abnormal return (above the market return) through either technical analysis or fundamental analysis. Three forms of efficient market hypothesis exist: weak form (stock prices reflect all information of past prices), semi-strong form (stock prices reflect all publicly available information) and strong form (stock prices reflect all relevant information including insider information).

 Elasticity (of an option)

Percentage change in the value of an option given a 1% change in the value of the option`s underlying stock.

 Elliott Wave Theory 

Elliott is a method of analysing markets based on patterns of past price action and how these patterns relate to a simple master plan. The master plan is that there is an impulse wave consisting of 5 parts, followed by a corrective wave, usually of 3 parts but which can get somewhat complex. The master plan has a number of rules in particular relating to the relationships between the various waves and uses Fibonacci numbers including the "Golden" ratio of 61.8%. Elliott is a very optimistic theory as down moves are always corrective and new impulse moves always go to new highs eventually.

 EMS

European Monetary System

 EMU

European Monetary Union

 Entry

The act of taking a trading position in the market.

 Equivolume Chart

Richard Arms created this type of chart. It measures the relationship between price and volume. Price is measured on the vertical axis and volume is measured on the horizontal axis.

 Eurodollars

Deposits denominated in US dollars held in banks outside the United States, mainly in Europe, and commonly used for settling international transactions.

 European Option

An option which can only be exercised on its expiration date.

 Equity

Refer to securities that represent ownership (equity in a company) in other words, stocks.

 Еxchange rate

The price at which one currency trades for another.

 Exchange risk

The risk that an investment`s value will change because of currency exchange rates.

 Exchanges

The places where stocks, bonds, and other securities are bought and sold. Membership on an exchange is called exchange seat.

 Exercise

The right granted under the terms of a listed options contract.

 Exercise Price

The price at which the security underlying a future or options contract may be bought or sold.

 Exit

The act of ending a trading position in the market.

 Expected Return

The expected return on a risky asset, given a probability distribution for the possible rates of return.

 Expert Systems

A type of application program that makes decisions or solves problems in a particular field by using knowledge and analytical rules defined by experts in the field.

 Expiration Date

The last day or the only day on which an option may be exercised.

 Exponential Moving Average

Similar to a moving average except it gives greater weight to recent price data. EMAs are calculated by the following formula: ЕМА = (today’s closing price * k) + (yesteday’s moving average value * (1-k)), where k=2/(n+1); n = the specified number of periods.

 Extendable Bond

Bond whose maturity can be extended at the option of the lender or issuer .

 Failure

In Elliott wave theory, a five-wave pattern of movement in which the fifth impulse wave fails to move above the end of the third, or in which the fifth wave does not contain the five subwaves.

 False Breakout

Short-term movement of a rate through some conditional border (the previous top or a bottom, a level of consolidation), and then return and movement to the opposite party.

 Fast Fourier Transform  

A method by which to decompose data into a sum of sinusoids of varying cycle length, with each cycle being a fraction of a common fundamental cycle length.

 Fast Market

A declaration that market conditions in the futures pit are so disorderly temporarily to the extent that floor brokers are not held responsible for the execution of orders.

 Federal Reserve Bank

The governing central bank of the US.

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 Fibonacci Ratio  

The ratio between any two successive numbers in the Fibonacci sequence, known as phi (ø).  The ratio of any number to the next higher number is approximately 0.618 (known as the Golden Mean or Golden Ratio), and to the lower number approximately 1.618 (the inverse of the Golden Mean), after the first four numbers of the series. The three important ratios the series provides are 0.618, 1.0 and 1.618.

 Fibonacci Sequence

The sequence of numbers (0, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233...), discovered by the Italian mathematician Leonardo de Pisa in the 13th century and the mathematical basis of the Elliott wave theory, where the first two terms of the sequence are 0 and 1 and each successive number in the sequence is the sum of the previous two numbers. Technically, it is a sequence and not a series.

 Figure

100 pips.

 Fill Order 

An order that must be filled immediately (or canceled).

 Financial Assets

Contracts that state agreement about the exchange of money in the future.

 Financial Instrument

This term generally refers to any futures or option contract that is not based on an agricultural commodity or a natural resource. It includes currencies, securities, mortgages, commercial paper and stock indexes of various kinds.

 Fine print

A reference to imaginary small type in a policy contract supposedly containing exclusions, reductions, exemptions, and limitations of coverage. Most state laws include specifications for the minimum type size that can be used in a policy, and they also provide that exclusions cannot be printed in type smaller than that used to print the benefits.

 Fiscal Policy

Government spending and taxing for the specific purpose of stabilizing the economy.

 Flat/Square Position

To either have no positions or positions that cancel each other out.

 Flag

A pattern formed during a short consolidation in price movement that is contained by two parallel lines and thus looks similar to a flag on a flagpole. Additionally, the price movements before and after the flag are generally equal in length.

 Floor Broker

A member of the stock exchange who executes orders on the floor of the exchange to buy or sell any listed securities.

 Floor Traders

Employees of brokerage firms working on exchange trading floors.

 Forecast

A future trend evaluation based on the exploration and analysis of the available information.

 Foreign exchange

The purchase or sale of a currency against sale or purchase of another.

 Forex

Foreign Exchange.

 Forward

A deal that will commence at an agreed date in the future. Delivery of the asset is complete on the contract expiration date.

 Forward Interest Rate

Interest rate fixed today on a loan to be made at some future date.

 Fractal Dimension  

From fractal geometry, used to describe the irregular nature of lines, curves, planes or volumes.

 Fractals

Depiction of mathematical models that may be applied to identify data patterns.

 Free-riding

The rapid buying and selling of a security without any intention of paying for the transaction. This practice is illegal.

 Fundamental Analysis

The analytical method by which only the sales, earnings and the value of a given tradable's assets may be considered.

 Future Volatility

A prediction of what volatility may be like in the future.

 Futures

An agreement between a buyer and a seller to receive and deliver on a future date a specified amount of a product at an agreed price.

 Futures Contract

A standardized forward contract that is traded on an exchange.

 Futures Option

An option that gives its holder the right to buy or sell a futures contract at a certain price.

 Futures Price

The price at which the parties to a futures contract agree to transact upon the settlement date.

 Fuzzy Systems

A problem-solving method that can be applied to neural networks, expert systems and other comput ing methods. Fuzzy systems process inexact information inexactly and describe ambiguity rather than the uncer tainty of an occurrence and are useful in performing control and decision-making tasks.

 G-7

An organization of the seven major industrialized nations including the United States, Canada, Britain, France, Italy, Germany, and Japan that meets to discuss international economic issues.

 Gann Theory

Various analytical techniques developed by legendary trader W.D. Gann.

 Gap

A day in which the daily range is completely above or below the previous day's daily range.

 Genetic Algorithms

Algorithms that mimic the characteristics associated with evolution and that are well-suited to optimization problems such as optimizing neural network parameters.

 Geometric Average

A compounded average rate of return that is time weighted for a specified time period. Geometric averages are often used for measuring the performance of an investment portfolio, adjusted for the timing of new deposits and withdrawals.

 Good till Canceled (GTC)

An order to buy or sell stock that is good until you execute or cancel it.

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 Golden Section

A line segment divided into two parts. The ratio of the short half to the long half is equal to the ratio of the long half to the whole. The ratio between the larger part and the whole is always 0.618.

 Gross Domestic Product (GDP) 

For a region, the GDP is the market value of all the goods and services producted by labor and property located in the region, usually a country. It equals Gross National Product minus the net inflow of labor and property incomes from abroad.

 Growth Investing

An investment approach that favors the stocks of rapidly expanding companies with a high rate of earnings growth. Often, these are the stocks of start-up ventures or newer firms that are just entering high-growth industries. Because of their growth potential, their stock price often reflects investor opinion of future growth prospects (rather than current earnings), resulting in a high price-to-earnings ratio.  Growth investing is often contrasted with value investing.

 Hard Currency

A freely convertible currency that is not expected to depreciate in value in the foreseeable future.

 Head and Shoulders

A chart pattern indicating a peak, a decline, a second even higher peak, a decline, a rebound to the level of the first peak, and yet another decline. A head and shoulders pattern is supposed to be bad news, indicating the stock is headed downward.

 Hedge Ratio (for an option)

Ratio between the change in an option’s theoretical value and the change in price of the underlying stock at a given point in time. Also called delta.

 Hedging

Taking a position in a futures market opposite to a position held in the cash market to minimize the risk of financial loss from an adverse price change.

 Hedging Demands

Demands for securities to hedge particular sources of consumption risk, beyond the usual mean-variance diversification motivation.

 High/Low/Open/Close

High is the highest level at which a security or commodity has traded, while low is the lowest level. Open/close are the opening and closing levels for any of the price periods.

 Horizon Analysis

Interest rate prediction that uses a forecast yield curve to predict bond prices.

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 Hot

Currently very popular or successful. For example, hot stocks, hot funds, hot investment strategies, etc.

 Hypster

A person who makes enthusiastic posts in order to drive a stock's price up, often because he/she is holding the stock. 

 IBRD

The International Bank for Reconstruction and Development.

 IMF

International Monetary Fund.

 Implied Volatility

A measurement based on the premiums of market traded options of the expected price range of the underlying commodity.

 Income Beneficiary

An individual designated to receive distributions of trust income.

 Income Statement

A financial statement that shows revenue, expenses and profit during a given accounting period.

 Index

A benchmark against which financial or economic performance is measured. For example, the S&P 500 or CPI.

 Index Fund

A mutual fund that seeks to passively match the performance of some market index, such as S&P 500.

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 Index Investing

Index investing aims to earn a rate of return that is identical to the return a benchmark index earns. By constructing a portfolio that is identical to the index, an index fund manager matches its rate of return. The portfolio manager only needs to change the composition of the portfolio when the index changes. Index investing has lower fees than those investing approaches that rely on frequent buying and selling of securities.

 Indicator

A statistics which indicates current economic growth rates and trends such as retail sales and employment.

 Indirect Quotation

States the number of units of foreign currency per unit of local or domestic currency. For example, GBP/USD.

 Inflation

An economic condition whereby prices for consumer goods rise, eroding purchasing power.

 Initial Balance

The first or first two half-hour trading periods in the CBOT Market Profile during which prices tend to converge; the initial auction of the trading day.

 Initial Margin

The required initial deposit of collateral to enter into a position as a guarantee on future performance.

 Inside information

Material information about a company which is known by the company's board of directors, management, and/or employees but not by the public.

 Interbank Rates

The interest rate that the banks charge each other for loans. This rate is applicable to the short-term international interbank market, and applies to very large loans borrowed for anywhere from one day to five years.

 Interest

The fee charged by a lender to a borrower for the use of borrowed money, usually expressed as an annual percentage of the principal.

 Interest Rate

Interest per year divided by principal amount, expressed as a percentage.

 Interest Rate Swaps

An exchange of interest payments on a specific principal amount. This is a counterparty agreement, and so can be standardized to the requirements of the parties involved. Often, an interest rate swap involves exchanging a fixed amount per payment period for a payment that is not fixed. In an interest rate swap, the principal amount is never exchanged, it is just a notional principal amount.

 Intermarket Spread Swap

A swap transaction meant to capitalize on a yield discrepancy between bond market sectors.

 Intraday

During a single trading day.

 Inverse Head and Shoulder

The inverse head and shoulders is a mirror image of the head and shoulders.

 Investment Company

Firm that invests the pooled funds of retail investors for a fee. By aggregating the funds of a large number of small investors into a specific investments (in line with the objectives of the investors), an investment company gives individual investors access to a wider range of securities than the investors themselves would have been able to access.

 Joint Account

An account in which two or more individuals possess some form of control over the account and may transact business in the account.

 Kiwi

A market term for the New Zealand Dollar.

 Last

The average value between the most recent Bid and Ask (or the most recent Bid).

 Leverage

The degree to which an investor or business is utilizing borrowed money. The credit provided by the bank for margin trading.

 Leverage Ratio

The borrowing level that maximizes the value of the firm. The cost of capital to the firm is minimized at that same level.

 LIBOR

London Inter-Bank Offer Rate. The rate of interest that major international banks in London charge each other for borrowings.

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 Limit

The customer’s instruction to close a profitable position at a specific price.

 Limit Order

An order that instructs a broker to buy or sell a specified amount of a security at a specified price or at a better price.

 Limit Position

Maximum of allowable size of an open position.

 Limit Sell Order  

The order where a client asks to sell assets at or above a price limit even if current price of the asset is below that limit.

 Linear Regression Trendline

Linear regression is used to explain and/or predict. The general form is: Y = a + bX + u Where Y is the independent variable, X is the dependent variable, a is the intercept, b is the slope, and u is the regression residual .

 Liquidation

Any transaction that offsets or closes out a long or short position.

 Liquidation Value

Net amount that could be realized by selling the assets of a firm after paying the debt.

 Liquidity

A high level of trading activity, allowing buying and selling with minimum price disturbance. Also, a market characterized by the ability to buy and sell with relative ease.

 Liquidity Preference Theory

The theory that the forward rate exceeds expected future interest rates.

 Locked Limit

A market that, if not restricted, would seek price equilibrium outside the limit but, instead, moves to the limit and ceases to trade.

 Long

One who has bought a contract to establish a market position and who has not yet closed out this position through an offsetting sale.

 Long Hedge

The purchase of a futures contract in anticipation of actual purchases in the cash market. Used by processors or exporters as protection against an advance in the cash price.

 Long Position

Owning or holding options (i.e., the number of contracts bought exceeds the number of contracts sold). For equities, a long position occurs when an individual owns securities.

 Loss

The decrease in the value of an investment or asset.

 Loss Тaking

The closing of a position after reaching the critical level of loss.

 Lot

A measure of quantity. In the Meta Trader Bulbrokers trading platform one lot equals 100 000 units of the base currency.

 Maintenance or Variation Margin

An established value under which a trader's margin cannot fall. Reaching the maintenance margin triggers a margin call.

 Margin

The amount paid by the customer when using a broker's credit to buy or sell a security.

 Margin Account

An account with a brokerage firm that allows its clients to buy securities with money borrowed from the broker.

 Margin call

A demand for a client to deposit money or eligible securities with the broker to bring a margin account up to the initial margin or minimum maintenance requirements. A margin call is sent when the margin account's equity falls below specific levels.

 Margin Trading

Buying securities, in part, with borrowed money.

 Market Capitalization Rate

The market-consensus estimate of the appropriate discount rate for a firm`s cash flow .

 Мarket Мaker

One who maintains firm bid and offer prices in a given security by standing ready to buy or sell round lots at publicly quoted prices.

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 Market Maker Spread

The difference between the price at which a market maker is willing to buy a security and the price at which the firm is willing to sell it.

 Market Model

A model of stock returns that decomposes influences on returns into a systematic factor and unsystematic factor.

 Market on Close

An order to buy or sell at the end of the trading session at a price within the closing range of prices.

 Market Order

An order to buy or sell securities or commodities at the best price with immediate effect.

 Market Price

The price for a security.

 Market Тiming

A technique used by investors or money managers who believe they can predict when the market will change course.

 Mark-to-Market

The valuation process which provides an indication of reasonable prices for positions on a daily basis or some other proscribed time frame. In accounting parlance, it would mean valuing securities/loans at their market values.

 Maturity

The date on which a loan or bond comes due and is to be paid off.

 Mechanical System

The mechanical (computer) system of trade generating signals of an input (output) at the market.

 Momentum

A time series representing change of today's price from some fixed number of days back in history.

 Momentum Indicator

A market indicator utilizing price and volume statistics for predicting the strength or weakness of a current market and any overbought or oversold conditions, and to note turning points within the market.

 Momo Stock

A momentum stock.

 Monetary Policy

A central bank's actions to influence short-term interest rates and the supply of money and credit, as a means of helping to promote national economic goals.

 Money Flow

A number of technical indicators that incorporate volume and price action to measure buying or selling pressure.

 Money Markets

The markets in which dealers trade riskless, short-term securities such as certificates of deposit and Treasury bills.

 Money Stop

A fixed amount of money that a market participant would lose if a stop were hit.

 Morning Star  

A bottom reversal pattern, according to Steve Nison a signal that the bulls have seized control.

 Moving Average

A technical analysis term meaning the average price of a security over a specified time period. Used in order to spot pricing trends by flattening out large fluctuations.

 Moving Average Convergence/Divergence MACD

The crossing of two exponentially smoothed moving averages that are plotted above and below a zero line. The crossover, movement through the zero line, and divergences generate buy and sell signals.

 Moving Average Crossovers

The point where the various moving average lines intersect each other or the price line on a moving average price bar chart. Technicians use crossovers to signal price-based buy and sell opportunities.

 Moving Average Model

A time series equation representing an observed value at time t as a linear combination of present and past random shocks et (forecast errors). A moving-average process of order Q, MA(q), may be written: Pt = et – b1et-1 – b2et-2…bqet-q.

 Multiple Linear Regression

More than one independent variable is used to account for the variability in one depen dent variable.

 Mutual Fund

A company that invests money of its shareholders in a variety of areas, usually stocks.

 Narrow Market

An inactive market, which displays large fluctuations in prices due to a low volume of trading.

 NASD (National Association of Securities Dealers)

The NASD is an industry organization that regulates the behavior of member securities dealers. In addition, it owns and operates Nasdaq, the automated quotation system for over-the-counter trading. The NASD derives its authority from the federal government, and every securities dealer in the country is required by law to be a member.

 NASDAQ
(National Association of Securities Dealers Automated Quotations System )

The electronic stock exchange run by the National Association of Securities Dealers for over-the-counter trading. Established in 1971, it is America's fastest growing stock market and a leader in trading foreign securities and technology shares as well. It boasts many more listed companies than the New York Stock Exchange, and handles more than half the stock trading that occurs in this country.

 National Association of Investors Corporation NAIC

Also known as the National Association of Investment Clubs.

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 Necessary Margin

Necessary pledge for opening a position.

 Net Asset Value

The total market value of all securities contained in a mutual fund; also known as price per share.

 Neural Nets

An artificial intelligence program that is capable of learning through a training process of trial and error.

 Nikkei 225 Index

Index of the 225 major stocks on the Tokyo stock exchange.

 Non-Trend Day

A narrow range day lacking any discernible movement in either direction.

 Normal Distribution

For the purposes of statistical testing, the simulated net returns are assumed to be drawn from a particular distribution. If net returns are drawn from a normal distribution, low and high returns are equally likely, and the most likely net return in a quarter is the average net return.

 OCO /One Cancels the Other/

A limit order consisting of two BUY orders (or two SELL orders) placed at levels either side of the current market value. The execution of one order automatically cancels the other.

 Offer/Ask

The price at which a seller is prepared to deal.

 Offshore Company

A company incorporated in a country where there is little government control and/or low tax rates.

 Open Interest

The total number of derivative contracts traded that have not yet been liquidated either by an offsetting derivative transaction or by delivery.

 Open (good-till-canceled) Оrder

A buy or sell order remaining in force for up to six months unless canceled.

 Open Position

Any position (long or short) that is subject to market fluctuations and has not been closed out by a corresponding opposite transaction.

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 Open Trades

Current trades that are still held active in the customer's account.

 Option

A contract that provides the right but not the obligation to buy or sell a specified amount of a security within a specified time period.

 Option Premium

The market price of an option that is paid by an option buyer to the option writer for the right to buy or sell the underlying security at a specified price by the option's expiration date.

 Order

A request from a client to a broker to buy (buy order) or sell (sell order) a specified amount of a particular security or commodity at a specific price or at the market price. There are different types of orders: market order, limit order, good-till-canceled order, etc.

 Oscillator

Technical indicator used to identify overbought and oversold price regions. An indicator that detrends data, such as price.

 OTC (Over the counter)

A decentralized market (as opposed to an exchange market) where geographically dispersed dealers are linked by telephones and computer screens. The market is for securities not listed on a stock or bond exchange.

 OTC Option

Any option which is not traded on a listed exchange.

 Out-of-Sample

An item within the range of a sample that does not conform to the mean of the sample.

 Overbought

Market prices that have risen too steeply and too fast.

 Overbought/Oversold Indicator

An indicator that attempts to define when prices have moved too far and too fast in either direction and thus are vulnerable to a reaction.

 Overnight

Оставане на отворена позиция за следващия работен ден. “Пренощуване”.

 Oversold

Market prices that have declined too steeply and too fast.

 Parity

Equality.

 Parking

Putting money into safe investments such as money market investments while deciding where to invest the money.  In Internet, parking is the process by which someone selects a domain name, and "parks" it by registering the domain name under someone's name servers.

 Passive Portfolio

A market index portfolio.

 P/E Effect

Stocks with low PE ratios provide higher returns than stocks with higher PEs.

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 Pink Sheet/Penny Stocks

Daily listings of price quotations for thousands of over-the-counter securities not traded on Nasdaq. Published on pink paper by the National Quotation Bureau (a unit of Commerce Clearing House), the pink sheets list stocks that are smaller, newer, and generally riskier and less actively traded than those listed on Nasdaq and the other traditional exchanges.  Penny stocks are highly speculative stocks that do not trade on any of the major exchanges. Penny stocks are prone to all sort of speculative bubbles, trading inefficiencies and other difficulties. They are quite risky

 Pip/Point

The smallest unit of price for any foreign currency (e.g., for USD/CHF one point (or pip) equals .0001 Swiss Francs and for USD/JPY one point (or pip) equals 0.01 Japanese Yen)..

 Point and Figure Chart

A chart, which plots only price. X's are place in boxes representing up days; and O's are placed in boxes representing down days.

 Portfolio Management

The process of managing the assets of a mutual fund, including choosing and monitoring appropriate investments and allocating funds accordingly.

 Portfolio Тurnover

An annualized rate found by dividing the lesser of purchases and sales by the average of portfolio assets.

 Position

The amount of a security either owned (a long position) or owed (a short position) by an investor or dealer.

 Position Limit

The maximum number of listed option contracts on a single security which can be held by an investor or group of investors acting jointly.

 Position trading

A style of trading characterized by holding open positions for an extended period of time. Contrast this with day trading, where a trader buys, then sells out of a position before the market closes that day.

 Price-Earnings Ratio

Stock price divided by annual earnings per share.

 Primitive Security, Derivative Security

A primitive security is an instrument such as a stock or bond for which payments depend only on the financial status of its issuer. A derivative security is created from the set of primitive securities in an attempt to yield returns that depend on factors beyond the characteristics of the issuer and that may be related to prices of other assets.

 Principal

The person for whom a broker executes an order, or dealers buying or selling for their own accounts. The term principal may also refer to a person's capital or to the face amount of a bond.

 Profit

The positive gain from an investment or business operation after subtracting for all expenses.

 Profit Taking

Selling tradables that have appreciated since initial purchase in order to take advantage of the appreciation.

 Program Тrading

Trades based on signals from computer programs, usually entered directly from the trader's computer to the market's computer system.

 Proxy

The process by which shareholders who cannot attend a fund's annual meeting vote by mail.

 Pump-and-Dump

The unscrupulous attempt to hype a stock one is holding to get the price to rise, then selling as soon as it does. 

 Put Bond

A bond that can be redeemed on a date or dates prior to the stated maturity date by the bondholder.

 Put Option

An agreement that gives an investor the right, but not the obligation, to sell a stock, bond, commodity or other instrument at a specified price within a specific time period.

 Pyramiding

This means adding to initial positions once those initial positions are in profit.

 Quantitative Аnalysis

A research technique that deals with measurable values as distinguished from such qualitative factors as the character of management or labor relations. Quantitative analysis uses financial information derived from company balance sheets and income statements to make investment decisions. Examples of quantitative analysis include a review of company financial ratios, the cost of capital, asset valuation, and sales and earnings trends.

 Quote

The highest bid or lowest ask price available on a security at any given time.

 Quoted Currency

The currency quoted against the base currency, i.e. the numerator quoted in terms of the denominator. For example, the quoted currency in the USD/BGN quotation is the Bulgarian lev.

 Rally

A recovery in price after a period of decline.

 Range

The difference between the high and low price during a given period.

 Rate Anticipation Swap

A type of swap in which bonds are swapped according to their current duration and predicted interest rate movements.

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 Ratios

Based on accounts of companies. Ratios are used for analysis of the financial activity of companies and estimation of the attractiveness of investments. The most frequently used ratios are Liquidity ratio, Profitability ratio and Leverage ratio. Two frequently used liquidity ratios are the Сurrent ratio (or the Working Capital ratio) and the Quick ratio. The current ratio is the ratio of current assets to current liabilities. The quick ratio is the ratio of current assets – inventory to current liabilities. The quick ratio often is reffered to as the Acid test ratio. The leverage ratio is the ratio of debt to equity, as well as liabilities to assets. The profitability ratio is the firm's return-on-assets. In addition, there are Dividend payout ratio (percentage of earnings paid out as dividends), Sales per employee or Net profit per employee ratio, etc. 

 Real Assets, Financial Assets

Real assets are land, buildings, and equipment that are used to produce goods and services. Financial assets (i.e. securities) are claims to the income generated by real assets.

 Rebound

A rally following a decrease in price.

 Recession

A period of general economic decline.

 Registered bond

A bond issued with the name of the owner printed on the face of the certificate. It can be transferred to another individual only with the owner's endorsement.

 Registered Trader

A member of an exchange who is responsible for adding "liquidity" to the marketplace by purchasing or selling assigned securities from his or her inventory.

 Registration Statement

Document filed with the Securities and Exchange Commission (SEC) explaining an impending issue and pertinent data about the issuer. Based on the information provided, the SEC either permits or prevents the issue from being offered.

 Regulation Q

A Federal Reserve Board regulation that limits the interest rate that banks can pay on savings deposits.

 Regulation T

A federal regulation that governs the lending of money by brokerage firms to its customers. Regulation T requires the customer to deposit margin of 50% in payment for the securities.

 Relative Strength

A comparison of the price performance of a stock to a market index such as Standard & Poor's 500 stock index.

 Resistance

Inability of a stock to rise above a certain price (resistance level).

 Retracement

A price movement in the opposite direction of the previous trend.

 Return On Assets (ROA)

A measure of a company's profitability, equal to a fiscal year's earnings divided by its total assets, expressed as a percentage.

 Return On Equity (ROE)

The net earnings of a company divided by its equity.

 Return On Sales (ROS), /or profit margin/

A measure of a company's profitability, equal to a fiscal year's pre-tax income divided by total sales.

 Reversing trade

Entering the opposite side of a currently held futures position to close out the position.

 Reward-to-Volatility Ratio

Ratio of excess return to portfolio standard deviation.

 Risk Control

Using of trading rules for restriction of losses.

 Rollover

A transaction designed for spot deals whereby the delivery is extended and "exchanged" from the old spot delivery date to the current spot delivery date.

 Round Тrip

Buying and selling of a specified amount of currency.

 Scalper

A trader who trades for small, short-term profits during the course of a trading session, rarely carrying a position overnight.

 Screening

A process of choosing potentially interesting stocks from the universe. It includes the application of screens to the database. The best databases allow users to use all types of logic operators ("And," "Or," "No", etc.) and filters: formal, fundamental and technical.

 Security Analysis

Security analysis seeks to determine the intrinsic value of securities.

 Security Selection Decision

Choosing the particular securities to include in a portfolio.

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 Sell

To convey ownership of a security or another asset for money or value.

 Sell Limit

An order to sell a security at a specified price or higher.

 Sell Stop

An order to sell a security that is entered at a price below the current market price.

 Short

To sell a stock short. An individual who is holding a short in a particular security. Here, also called short seller. Opposite of long.

 Short Interest Rate

A one-period interest rate.

 Short Position

Stock shares that an individual has sold short and has not yet covered, as of a particular date.

 Short Sale

Borrowing a security from a broker and selling it, with the understanding that it must later be bought back (hopefully at a lower price) and returned to the broker. Short selling is a technique used by investors who try to profit from the falling price of a stock.

 Sideways Market

Situation that occurs when prices move within a narrow range, with minimal fluctuations.

 Slippage

Situation when stop order is carried out at more worse rate, than it has been ordered at his exhibiting to the broker. Such phenomenon could be met at quickly varying market. For example, it can occur after an output of the important fundamental data, during performances of known politicians. It is not obviously possible to execute the warrant at the set rate, if the quotation overcomes the set level sharp jump. The size slippage can vary from one item up to several tens items. Frequently slippage takes place at opening trade on Sunday in the evening when rates of opening differ from rates of closing.

 Soft currency

The currency exchanged for other currencies with some restrictions.

 Soft Dollars

The value of research services that brokerage houses supply to investment managers free of charge in exchange for the investment managers business commissions.

 Specialist

A stock exchange member who makes a market for certain exchange-traded securities, maintaining an inventory of those securities and standing ready to buy and sell shares as necessary to maintain an orderly market for those shares.

 Speculation

Taking large risks, especially with respect to trying to predict the future; gambling, in the hopes of making quick, large gains.

 Speculative-Grade Bond

Bond rated Ba or lower by Moody`s, or BB or lower by S&P, or an unrated bond.

 Speculator

The person that ready to risk funds at fulfillment of trading operations for the sake of reception of the profit.

 Spike

Significant difference of the subsequent quotation from previous. Graphic representation of the culmination moment in the market, describing most rigid "collision" of buyers and sellers. Characterizes nervousness of the market. Soldering can appear at the moment of an output of especially important news for the market. However there are situations when soldering appears on the screen without the weighty reasons; such meets in the narrow market. It either "overindulgence" of operators, or special shaking of the market.

 Split

An increase in the number of outstanding shares of a company's stock, such that proportionate equity of each shareholder remains the same. This requires approval from the board of directors and shareholders. A corporation whose stock is performing well may choose to split its shares, distributing additional shares to existing shareholders. The most common split is two-for-one, in which each share becomes two shares. The reverse split is a stock split which reduces the number of outstanding shares and increases the per-share price proportionately. This is usually an attempt by a company to disguise a falling stock price, since the actual market capitalization of the stock does not change at all.

 Spot

Normally settlement for two working days from today.

 Spot Rate

The rate for purchase or sale of a foreign currency for delivery on the spot date (immediate delivery as defined in spot date).

 Spread

The difference between the current bid and the current ask.

 Spread (futures)

Long one future and short another. Both have the same underlier, but they have different maturities.

 Spread (options)

The purchase of one option and the simultaneous sale of a related option, such as two options of the same class but different strike prices and/or expiration dates.

 Square

Purchase and sales are in balance and thus the dealer has no open position.

 Squeeze

Situation in which investors who hold long positions feel the need to sell into a falling market to cut their losses, which leads to a further decline in market prices. Short squeeze is a situation in which the price of the stock rises and investors who sold short rush to buy it to cover their short position and cut their losses.

 Standard Deviation

A statistical measure of the historical volatility of a mutual fund or portfolio, usually computed using 36 monthly returns. More generally, a measure of the extent to which numbers are spread around their average.

 Sterling

Trader jargon for the British Pound Sterling referring to the Sterling/US Dollar exchange rate.

 Stock

An instrument that signifies an ownership position in a corporation, and represents a claim on its proportional share in the corporation's assets and profits.

 Stock Exchanges

An exchange on which shares of stock and common stock equivalents are bought and sold.

 Stock Split

An increase in the number of outstanding shares of a company's stock, such that proportionate equity of each shareholder remains the same.

 Stop-Limit Order

A combination of a stop order and limit order - that is, the order becomes a limit order after the specified stop price has been reached.

 Stop Loss Order

Order to buy or sell at the best available price when a given price threshold has been reached.

 Straddle

The purchase or sale of an equal number of puts and calls, with the same strike price and expiration dates. A straddle provides the opportunity to profit from a prediction about the future volatility of the market.

 Strike Price

The specified price on an option contract at which the contract may be exercised, whereby a call option buyer can buy the underlier or a put option buyer can sell the underlier.

 Strip, Strap

Strip is a combination of two puts and one call options of the same series, with the same underlying security, exercise price and expiration date. Strap is a combination of two calls and one put options of the same series, with the same underlying security, exercise price and expiration date.

 Substitution Swap

Exchange of one bond for another with similar attributes but a more attractive price.

 Support

A price level under which it is supposedly difficult for a stock or stock index to fall.

 Swap

See Currency Swap.

 Swissy

Market slang for Swiss Franc.

 Take Profit

The action taken by investors to sell when prices are rising in order to secure gains. Profit-taking often results in a subsequent decrease in price.

 Technical Analysis

A form of market analysis that studies demand and supply for securities and commodities based on trading volume and price studies. Using charts and modeling techniques, technicians attempt to identify price trends in a market.

 Technical Indicators

Tools used by a technical analyst to determine the likely future price direction.

 Тhin Мarket

A market in which trading volume is low and in which consequently bid and asked quotes are wide and the liquidity of the instrument traded is low.

 Tick

The smallest possible movement (up or down) in the price of a security.

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 Ticker

A scrolling display of current or recent security prices and/or volume. Ticker symbol is a system of letters used to uniquely identify a stock or mutual fund. Symbols with up to three letters are used for stocks which are listed and trade on an exchange. Symbols with four letters are used for Nasdaq stocks. Symbols with five letters are used for Nasdaq stocks other than single issues of common stock. Symbols with five letters ending in X are used for mutual funds. 

 Time Value (of an option)

The amount by which an option's premium exceeds its intrinsic value.

 Тrade

A transaction of a security or commodity.

 Тrader

One who buys and sells securities for his/her personal account, not on behalf of clients.

 Тrading

Buying and selling securities or commodities on a short-term basis, hoping to make quick profits. More generally, any buying and selling of securities or commodities.

 Trading System

The combination of rules in accordance with which a trader opens long and/or short positions. Trade system in informational technologies is a virtual system for trade transactions in the mode of a buyer and seller dialog. Usually, a trade system provides consultant services, infrastructural support and other additional possibilities.

 Transaction

An agreement between a buyer and a seller to exchange an asset for payment. The buying or selling of foreign exchange amount resulting from the execution of an order.

 Treasury Bill (T-bill)

A negotiable debt obligation issued by the U.S. government and backed by its full faith and credit, having a maturity of one year or less. Exempt from state and local taxes. Also called Bill or T-Bill or U.S. Treasury Bill.

 Trend

The current general direction of movement for prices or rates.

 Trough

A low point or local minimum.

 Two Way Quote

When a dealer quotes a bid and ask price for foreign exchange transactions to a customer.

 Unemployment Rate

Refers to the unemployed labour force expressed as a percentage of the total labour force.

 Unit

A quantity generally accepted as a standard for exchange. A combination of multiple securities, such as common stock and warrants, sold together as a single product. A corporation, for example, might issue a security that consists of one common share and one warrant that sells as a unit.

 Uptrend

Upward price movement of a security or the overall market.

 Value Date

The date on which a foreign exchange transaction is settled by payment and delivery.

 Variation Margin

Additional margin required to bring an account up to the required level due to market fluctuations.

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 Volatility

The relative rate at which the price of a security moves up and down. Volatility is found by calculating the annualized standard deviation of daily change in price. Implied volatility is a theoretical value designed to represent the volatility of the security underlying an option as determined by the price of the option.

 Volatility Risk

The risk in the value of options portfolios due to the unpredictable changes in the volatility of the underlying asset.

 Volume

The shares that are traded for a given market or tradable within a specified time period.

 Warrant

A type of security that entitles the holder to buy a proportionate amount of common stock or preferred stock at a specified price for a period of years.

 Weak Hands

Nervous investors who follow the herd and sell stock at the first sign of weakness.

 Wire

A term used to describe practically all types of networks. For example news wire, wire transfer (an electronic transfer of funds), etc.

 Yard

Market slang for a billion.

 Yield

The annual rate of return on an investment, expressed as a percentage.

 YTM (Yield-to-Maturity)

Yield that would be realized on a bond or other fixed income security if the bond was held until the maturity date. 
                                                                                 

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