By Craig Wilson
This post 60 Investing Terms You Need to Know appeared first on Daily Reckoning.
Whether you are a beginning investor or are just getting into finance, understanding market lingo can leave you better positioned for the future.
Reading editorials ranging from ZeroHedge, Wall Street Journal or even Barron’s can become daunting with jargon. Investing terms can morph into their own coded language.
Not to fear, the world of investments is an ever-changing environment and knowing investing terms will put you at a great advantage. Below is a introductory list of 60 investing terms you need to know to gain a financial edge:
Active Trading Terminology:
Buy – A recommendation or action to purchase specific shares from a given company.
Sell – A reference to closing out a position on shares that were purchased. Typically calls to “sell” come from hitting a specific objective or to reduce losses occurred.
Bid – The price offer made to purchase a given stock that relates to what you’re willing to spend and how many shares purchased from that buy.
Ask – Inversely from a bid, this is the quote price a buyer is looking to get per share (almost always higher than a bid).
Quote – The latest data on a stock’s price that a buyer and seller actively agreed upon during transaction.
Returns – What is gained or lost through an investment over a specific time frame. These are typically views in returns on investment, equity and assets.
Execution – This is the action of buying or selling an order for a specific share of stocks.
Reviewing Market Conditions:
Bear Market – A market where conditions have investors generally expect stock prices to decline. In this environment, selling increases and short selling is frequent.
Bull Market – A financial market environment where prices are rising or anticipated to rise. While typically referencing the stock market it can also be applied to bonds, commodities (gold) or currency.
Volatility – The statistical rate at which a stock increases or decreases. Typically refers to uncertainty or risk in changes of a stock.
Liquidity – The ability for investors to get in and out of a stock or given security. This measures how easy an individual or company can buy or sell at given prices in a market.
Credit Risk – The threat that a borrower may not meet obligations of a loan and a lender could experience loss on the principal or interest of a specific loan.
Fundamentals – Data (quantitative and qualitative) that signals to the financial value of a company, stock or currency. This references how stable or risky a business or asset is.
Investing Terms on Pricing:
Yield – The amount of income from a return on an investment. This typically comes through dividends of a particular stock.
Rally – A continued rise in the price of the market that can also be focused on particular stocks and bonds. This movement varies …read more
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