Glossary of Key Trading Terms
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| Ask | The lowest price that an investor or dealer is prepared to sell a given security. |
| Bear | One who believes prices will move lower. |
| Bid | The price that the investors are willing to pay for a security |
| Blue Chip | The shares of a large company which is known for excellent management and a strong financial structure. |
| Book Value | The value of an asset or security as it appears on a balance sheet. |
| Bourse | French term for a stock exchange. |
| Brokerage Fee | The fee charged by a broker for the execution of a transaction; also called “commission”. |
| Bull | One who believes prices will move higher. |
| Buying Power | Net amount of money that a client can use to buy new or additional shares of stocks. |
| Capital Gain | The amount by which an asset’s sale price exceeds its purchase price. |
| Capitalization | The market price of a company, calculated by multiplying the share price by the number of shares outstanding. |
| Certificate | A formal declaration which is evidence of ownership. Sometimes called “Script”. |
| Commission | A fee charged by a broker for a purchase or sale of securities. |
| Day Order | also called Good for the day only. Any order to buy or sell a certain security that automatically expires if not executed on the day the order is placed. |
| Delisting | The removal of securities or shares from listing on the stock exchange. |
| Dividend | A taxable payment made to shareholders from a company‘s after tax earnings. |
| Ex- Dividend | Refers to the day when the dividend is subtracted from the price of a stock. |
| Float | The process of putting a company’s shares on offer to the public. |
| GTC | also called Good Till Cancelled. Orders that will remain valid until cancelled by the user or until it reached the set expiration date of the instrument. |
| GTD | also called Good Till Date. A market order that is only valid until the date specified when the order was entered. |
| Index | A grouping of shares that gives a measure of price movement, used to gauge the overall health of the market. |
| Inflation | The overall general increase in the level of prices of goods and services in the economy. |
| Initial Public Offering (IPO) | The first sale of stock of a company to the public. |
| Insider Trading | Illegally trading on information not available to the general public. |
| Limit Order | An order to buy or sell at a fixed price. |
| Market Order | An order to buy or sell a security at the present market price. |
| Offer | The lowest price that an investor or dealer is prepared to sell a given security. The same as “Ask”. |
| Overbought | Market condition where prices have risen too steeply and too quickly and are in danger of reversing. |
| Oversold | Market condition where prices have declined too steeply and too quickly and are in danger of reversing. |
| Philippine Stock Exchange (PSE) | The market place for trading in shares and other securities. |
| Preferred Shares | Shares which provide a specific dividend that is paid before any dividends are paid to ordinary shareholders and which rank ahead of common shares in the event of liquidation. |
| Rights Issue | An offering of common stock made to holders of an existing security which entitle them to buy new share of the same company at a discount to the existing market. |
| Split | An increase in the number of outstanding shares in a company, with the market price dropping proportionately. |
| Undervalued | A security or currency whose price is below its perceived value. |
| Volatility | The measurement of how much a security fluctuates over a period of time. |
| Volume | The total number of securities traded during a given period. |
| Yield | The annual rate of return on an investment expressed as a percentage. |