Glossary

A

  • Alpha: The return of the stock in excess of risk. The ‘profit margin’
  • Assets: Items that a business or individual owns that creates value and worth and can be converted to cash.

B

  • Balance Sheet: a statement that shows assets, liabilities, and equity.
  • Beta: The ratio showing the broker how inline the security is with the market.
  • Bond: It is a debt security, under which the issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay them interest.
  • Buy-Side: refer to advising institutions concerned with buying investment services.

C

  • Credit: the ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.

D

E

  • Equity: Value that you put into a business or asset.

F

G

H

I

  • Inflation: Overtime money loses value so inflation changes the value of money in accordance with current time and current prices in the market.
  • Interest Rate: The rate of  interest that will accumulate when you lend money.

J

K

L

  • Liability: Debts, claims, or potential losses for an individual or organization.

M

N

O

P

Q

R

  • Rate of Return: Think of this as a reward for ‘gambling’ your money. This is the money you get back from making an investment. The ‘cost’ of giving up your money for a certain period of time.

S

  • Security: Financial tool, ex. Stock
  • Short/short position: The sale of a security that is not owned by the seller, or that the seller has borrowed. Short selling is motivated by the belief that a security’s price will decline, enabling it to be bought back at a lower price to make a profit.
  • Spread: The difference between the bid and the ask price of a security or asset.
  • Sell-side: The part of the financial industry involved with the creation, promotion, analysis and sale of securities.
  • Stock Broker: a regulated professional individual, usually associated with a brokerage firm,  who buys and sells stocks and other securities for clients, through a stock exchange in return for a fee.

U

V

W

X

Y

Z

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