Share Trading Dictionary - Glossary & Meaning of Share Trading Terms

Share Trading Dictionary - Glossary & Meaning of Share Trading Terms


 Here is a dictionary and glossary of share trading terms and their meaning. These are most commonly used terms.

•     Aggressive Strategy - Strategy to invest in stocks with aggression and  high risk with expectation of good return.

•     Buy - To invest in shares of a stock for intraday trading, short-term investment or long-term investment.

•     Sell - To sell a stock and book profit or loss.

•     Hold - To hold a stock in portfolio for a longer period for a more or better return.

•     Buy at Open - Placing a buy order before the market opens. The order gets executed at the current opening price.

•     Capital Gain- Profit from the sale of an investment.

    Share Trading Dictionary

•     Capital Loss- Loss from sale of an investment.

•     Close a Position - To end an investment by selling or buying. Closing a long position requires selling, and closing a short position requires buying.

•     Cover - To purchase a previously sold contract.

•     Current Market Value -The current value of a portfolio.

•     Day Trader - A stock trader who buys and sells stocks on the dame day.

•     Day Trading or Intraday - Buying and selling stocks on the same trading day without taking possession of stocks for a long time.

•     Diversification - Creating a portfolio by investing in several stocks, bonds and other investments.

•     Equity - A stock or any other security representing an ownership interest.

•     Fundamental Analysis - Examining the financial and managerial aspects of a company prior to investing.

•     Growth Strategy -Investing in companies that are growing faster than its competitors.

•     Hedge Fund - Fund for aggressive trading.

•     IRA (Individual Retirement Account) -A tax-deferred retirement account for an individual that allows him to set aside up to $2,000 per year, with earnings tax-deferred until withdrawals begin at age 59 1/2 or later.

•     Long-Term Investment - Investment money for a longer period.

•     Limit Order - Buying or selling stocks on a fixed price rather than the current market price.

•     Long Position - Buy  stocks from the long side with the expectation that prices will rise.

•     Margin Account - An account with a brokerage company allowing an investor to borrow money from the broker to buy securities.

•     Money Management -The art to manage money with investments, budgeting, banking, and taxes.

•     Open a Position -To open an investment buy buying or selling. Opening a long position requires buying, and opening a short position requires selling.

•     Overbought and Oversold Indicator - Tool to determine if stocks are oversold at higher rates.

•     Risk Management - The art to manage risk profile of an investor.

•     Risk Tolerance -An investor's potential to handle risks in terms of investment.

•     S&P 500 - A basket of 500 stocks that are considered to be widely held by investors.

•     Short - The state of having sold a stock short without having covered it.

•     Short Selling - Borrowing a security or commodity futures contract from a broker and selling it with the hope of making profit. All such securities must be later bought back and returned to the broker.

•     Spread - Difference between the current bid and the current ask price of a stock.

•     Technical Analysis - A method of evaluating securities through historical prices and other trading variables.

•     Ticker Symbol - A system of letters used to uniquely identify a stock or mutual fund.

•     Volatility - The relative rate at which the price of a stock moves up and down.

•     Volume - The number of shares, bonds or contracts traded during a given period, for a security or an entire exchange. 

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