Simple stock investing glossary for your handy reference,
10-K: It is comprehensive summary report of a company's performance that public companies in the US are required to submit to Securities and Exchange Commission (SEC) each year.
10-Q: It is comprehensive report of a company's performance that all public companies in the US are required to be submitted quarterly to Securities and Exchange Commission (SEC)
52-Week High/Low: The highest and lowest price at which a stock traded in the past 12 months or 52 weeks
Ask: Ask Price also called offer price, offer, asking price or simply Ask, is the lowest price a seller of a stock is willing to accept for a share of that given stock.
Annual Report: An annual publication that public corporations must provide to shareholders to describe their operations and financial conditions
Bear Markets: A market condition in which the prices of securities are falling or are expected to fall
Bid: Bid price is the highest price that a buyer is willing to pay for a particular stock.
Blue Chip: A nationally recognized, well-established and financially sound company
Book Value: also known as carrying value is the value of an asset according to its balance sheet account balance. It is equal to Cost of asset minus the accumulated depreciation.
Bonus Issue: An offer of free additional shares to existing shareholders
Broker: is an Individual or firm that arranges transactions between investors for buying and selling for a commission, when the deal is executed
Bull Markets: A financial market of a certain group of securities in which prices are rising or are expected to rise.
Capital Gain: An increase in the value of a capital asset that gives it a higher worth than the purchase price
Credit Risk: the risk that the issuer will default or fail to pay the debt.
Cyclical Stock: A stock that rises quickly when economic growth is strong and falls rapidly when growth is slowing down
Debt to Equity Ratio: D/E is a financial ratio indicating relative proportion of entity's equity and debt used to finance an entity's assets. This ratio is also known as financial leverage
Defensive Stock: A company whose sales and earnings remain relatively stable during both economic upturns and downturns
Delisting: The removal of a listed security from the exchange on which it trades
Dividend Payout Ratio: The ratio of dividend paid to shareholder to its earnings
Dividend Policy: The policy a company uses to decide how much it will pay out to shareholders in dividends
Enterprise Value: is the value of a company, incorporating equity, debt and cash. It is essentially a way of measuring what it would cost to buy the company. It is calculated as market capitalization plus debt, minority interest and preferred shares minus total cash and cash equivalents
Equity: The value of an ownership interest in the company. It is equal to funds contributed by owners plus the retained earnings.
Free Cash Flow: is the amount of cash that a company has left over after it has paid all of its expenses, including investments.
Growth Stock:Shares in a company whose earnings are expected to grow at an above-average rate relative to the market
Income Stock: A stock with a history of regular dividend payments that constitute the largest portion of the stock's overall return
Index: A statistical measure of change in an economy or a securities market
Insider: Any person who has knowledge of, or access to, valuable nonpublic information about a corporation
Interest Rate Risk: the risk that bonds get affected from interest rate changes
Life Cycle: The course of events that brings a new product into existence and follows its growth into a mature product and into eventual critical mass and decline
Margin of Safety: A principle of investing in which an investor only purchases securities when the market price is significantly below its intrinsic value.
Market Capitalization: The total dollar market value of all of a company's outstanding shares
Mergers And Acquisitions - M&A: A merger is a combination of two companies to form a new company, while an acquisition is the purchase of one company by another with no new company being formed
Net Income: is a company's earnings or profit as reported on the income statement. Revenues minus all expenses gives you net income.
Preferred Stock: A class of ownership in a corporation that has a higher claim on the assets and earnings than common stock
Price-Earnings (P/E) Ratio: A valuation ratio of a company's current share price compared to its per-share earnings.
Recurring Revenue: The portion of a company's revenue that is highly likely to continue in the future
Reverse Stock Split:A reduction in the number of a corporation's shares outstanding that increases the par value of its stock
Secondary Market: A market on which an investor purchases an asset from another investor rather than an issuing corporation
Small Cap: Refers to stocks with a relatively small market capitalization
Speculative Stock: A stock with extremely high risk relative to potential return
Stock Exchange: A market in which securities, options or futures are traded
Working Capital: It represents operating liquididty available to a business. It is a measure of a both a company's effieciency and is short term financial health. Current assets minus current liabilities gives you working capital
10-K: It is comprehensive summary report of a company's performance that public companies in the US are required to submit to Securities and Exchange Commission (SEC) each year.
10-Q: It is comprehensive report of a company's performance that all public companies in the US are required to be submitted quarterly to Securities and Exchange Commission (SEC)
52-Week High/Low: The highest and lowest price at which a stock traded in the past 12 months or 52 weeks
Ask: Ask Price also called offer price, offer, asking price or simply Ask, is the lowest price a seller of a stock is willing to accept for a share of that given stock.
Annual Report: An annual publication that public corporations must provide to shareholders to describe their operations and financial conditions
Bear Markets: A market condition in which the prices of securities are falling or are expected to fall
Bid: Bid price is the highest price that a buyer is willing to pay for a particular stock.
Blue Chip: A nationally recognized, well-established and financially sound company
Book Value: also known as carrying value is the value of an asset according to its balance sheet account balance. It is equal to Cost of asset minus the accumulated depreciation.
Bonus Issue: An offer of free additional shares to existing shareholders
Broker: is an Individual or firm that arranges transactions between investors for buying and selling for a commission, when the deal is executed
Bull Markets: A financial market of a certain group of securities in which prices are rising or are expected to rise.
Capital Gain: An increase in the value of a capital asset that gives it a higher worth than the purchase price
Credit Risk: the risk that the issuer will default or fail to pay the debt.
Cyclical Stock: A stock that rises quickly when economic growth is strong and falls rapidly when growth is slowing down
Debt to Equity Ratio: D/E is a financial ratio indicating relative proportion of entity's equity and debt used to finance an entity's assets. This ratio is also known as financial leverage
Defensive Stock: A company whose sales and earnings remain relatively stable during both economic upturns and downturns
Delisting: The removal of a listed security from the exchange on which it trades
Dividend Payout Ratio: The ratio of dividend paid to shareholder to its earnings
Dividend Policy: The policy a company uses to decide how much it will pay out to shareholders in dividends
Enterprise Value: is the value of a company, incorporating equity, debt and cash. It is essentially a way of measuring what it would cost to buy the company. It is calculated as market capitalization plus debt, minority interest and preferred shares minus total cash and cash equivalents
Equity: The value of an ownership interest in the company. It is equal to funds contributed by owners plus the retained earnings.
Free Cash Flow: is the amount of cash that a company has left over after it has paid all of its expenses, including investments.
Growth Stock:Shares in a company whose earnings are expected to grow at an above-average rate relative to the market
Income Stock: A stock with a history of regular dividend payments that constitute the largest portion of the stock's overall return
Index: A statistical measure of change in an economy or a securities market
Insider: Any person who has knowledge of, or access to, valuable nonpublic information about a corporation
Interest Rate Risk: the risk that bonds get affected from interest rate changes
Life Cycle: The course of events that brings a new product into existence and follows its growth into a mature product and into eventual critical mass and decline
Margin of Safety: A principle of investing in which an investor only purchases securities when the market price is significantly below its intrinsic value.
Market Capitalization: The total dollar market value of all of a company's outstanding shares
Mergers And Acquisitions - M&A: A merger is a combination of two companies to form a new company, while an acquisition is the purchase of one company by another with no new company being formed
Net Income: is a company's earnings or profit as reported on the income statement. Revenues minus all expenses gives you net income.
Preferred Stock: A class of ownership in a corporation that has a higher claim on the assets and earnings than common stock
Price-Earnings (P/E) Ratio: A valuation ratio of a company's current share price compared to its per-share earnings.
Recurring Revenue: The portion of a company's revenue that is highly likely to continue in the future
Reverse Stock Split:A reduction in the number of a corporation's shares outstanding that increases the par value of its stock
Secondary Market: A market on which an investor purchases an asset from another investor rather than an issuing corporation
Small Cap: Refers to stocks with a relatively small market capitalization
Speculative Stock: A stock with extremely high risk relative to potential return
Stock Exchange: A market in which securities, options or futures are traded
Working Capital: It represents operating liquididty available to a business. It is a measure of a both a company's effieciency and is short term financial health. Current assets minus current liabilities gives you working capital
