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Glossary G - O :
The following glossary contains definitions to hundreds of common and not so common investment terms. (Note: These are simplified definitions for the purposes of this web site. Investors should not rely solely on these to develop their understanding of the stock market.)
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Growth Stock |
Common stock of a company with excellent prospects for above average growth; a company which over a period of time seems destined for above-average expansion.
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Hedge |
A protective maneuver; a transaction intended to reduce the risk of loss from price fluctuations.
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Income Stock |
A stock that provides a generous dividend yield that is relatively well assured.
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Inflation |
A generalized, sustained trend of rising prices.
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Initial Public Offering (IPO) |
A new issue of securities offered to the public for investment for the very first time.
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Insider |
All directors and senior officers of a corporation and those who may also be presumed to have access to inside information concerning the company; also anyone owning more than 10% of the voting shares in a corporation.
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Insider Report |
A report of all transactions in the shares of a company by those considered to be insiders of the company and submitted each month to securities commissions.
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Intangible Asset |
An asset having no physical substance (e.g. goodwill, patents, franchises, copyrights).
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Interest |
Money charged by a lender to a borrower for the use of his or her money.
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Investment |
The use of money to make more money, to gain income or increase capital, or both.
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Investment Advisor |
A salesperson employed by a securities firm who must be registered by the securities commission of the province or state where he or she works.
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Investor |
One whose principal concern is the minimization of risk, in contrast to the speculator, who is prepared to accept calculated risk in the hope of making better-than-average profits, or the gambler, who is prepared to take even greater risks.
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Issue |
Any of a company's securities; the act of distributing such securities.
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Lagging Indicators |
A selection of statistical data that, on average, indicate highs and lows in the business cycle behind the economy as a whole. For example, business expenditures for new equipment, short-term business loans, and overall value of manufacturing and trade inventories.
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Large-Cap / Blue Chip / Defensive Stocks |
some more common investments, which generally cost more per share, represent larger companies, and are not subject to great volatility. For example, Motorola would constitute blue chip investment.
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Leading Indicators |
A selection of statistical data that, on average, indicate highs and lows in the business cycle ahead of the economy as a whole. For example, capital investment, business starts, and profits.
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Liabilities |
Debts or obligations of a company, usually divided into current liabilities (due within one year) and long term liabilities (payable after one year).
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Limit Order |
A client's order to buy or sell at a specific price or better. The order can be executed only at that price or a better one.
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Liquidity |
The ability of the market in a particular security to absorb a reasonable amount of buying or selling at reasonable price changes.
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Listed Stock |
The stock of a company which is traded on a stock exchange.
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Long |
Signifies ownership of securities. Being 'long' 100 ABC means that the investor owns 100 ABC.
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Major Trend |
Underlying price trend prevailing in a market despite temporary declines or rallies.
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Manipulation |
The illegal practice of buying or selling a security for the purpose of creating a false or misleading appearance of active trading or for the purpose of raising or depressing the price to induce purchases or sales by others.
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Margin |
The amount paid by a client when he uses credit to buy a security, the balance being loaned by his broker against acceptable collateral.
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Market Order |
An ordered placed to buy or sell a security immediately at the best current price.
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Market Price |
The most recent price at which a security transaction took place.
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Material Change |
A change in the affairs of a company that is expected to have a significant effect on the market value of its securities.
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Money Market |
That part of the capital market in which short-term financial obligations are bought and sold. These include treasury bills, commercial paper, guaranteed investment certificates, and other investments.
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Net Asset Value |
Total assets of a corporation less its liabilities. Also referred to as shareholders' equity.
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Net Change |
The change in the price of a security from the closing price on one day to the closing price on the following trading day.
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Net Earnings |
That part of a company's profits remaining after all expenses and taxes have been paid and out of which dividends may be paid.
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New Issue |
An offering of stocks or bonds sold by a company for the first time.
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Odd Lot |
A number of shares which is less than a board lot.
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Offer |
The lowest price at which a person is willing to sell; as opposed to bid which is the highest price at which one is willing to buy.
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Open Order |
An order to buy or sell a security at a specified price, valid until executed or canceled.
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Over - The - Counter Stock |
Shares of stock which are not trading on a regulated exchange.
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