E54 20 New Words

E54 20 New Words by LB

Bear Market

A market condition in which securities prices are falling or are expected to fall, typically defined as a decline of 20% or more from recent highs over a sustained period. This environment often reflects pessimism and negative investor sentiment, leading to widespread selling. 🐻📉😟 | downtrend, decline, market slump

Bid Ask Spread

The difference between the highest price a buyer is willing to pay for an asset (bid price) and the lowest price a seller is willing to accept (ask price). This spread represents transaction costs, market liquidity, and volatility, and is a key indicator of market efficiency. 💵🔍💹 | price differential, spread, buy-sell gap

Blue Chip

A nationally recognized, well-established, and financially sound company known for its stable earnings, reliability, and strong market presence. These companies often pay dividends and are considered low-risk investments even during economic downturns. 💎🏢📈 | industry leader, market giant, stable investment

Brokerage

A company that buys and sells stocks and other securities for clients | investment firm, dealer, agent

Bull Market

A market condition in which the prices of securities are rising, and widespread optimism causes the positive trend to be self

Dividend

A sum of money paid regularly (typically quarterly) by a company to its shareholders out of its profits | payout, distribution, return

Equity

A stock or any other security representing an ownership interest | stock, ownership, stake

Financial Futures

Standardized contracts obligating the buyer to purchase an asset (or the seller to sell an asset) at a predetermined future date and price | futures contract, derivatives, commodities

Financial Options

A contract which gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified price on or before a specified date | options contract, call option, put option

Investment

The action or process of investing money for profit or material result | funding, venture, acquisition

IPO (Initial Public Offering)

The first time a company offers shares to the public | stock launch, public offering, market debut

Leverage

The use of borrowed capital to increase the potential return of an investment | gearing, debt financing, borrowed capital

Margin

Money borrowed from a brokerage firm to purchase an investment | loan, credit, debt

Martingale

A betting strategy that involves doubling the bet after each loss | betting system, doubling down, progressive betting

Penny Stock

A stock that trades at a relatively low price and market capitalization | small

Portfolio

A collection of financial investments like stocks, bonds, and cash | holdings, assets, investments

Securities

inancial instruments that represent an ownership position (equity), creditor relationship (debt), or rights to ownership (derivatives) in an entity. These tradable assets include stocks, bonds, options, and futures and are used for investment, hedging, and raising capital. 💹📜💼 | financial assets, investment instruments, tradable assets

Shares

Units of ownership in a corporation or financial asset that entitle the holder to a portion of the company’s profits and assets. Shares can be common or preferred, offering voting rights and potential dividends based on the company’s performance. 📊🏢💰 | stocks, equity units, ownership stakes

Short Selling

A trading strategy where an investor borrows and sells a security with the expectation that its price will decline, enabling them to buy it back at a lower price to return the borrowed asset and profit from the difference. This approach involves high risk and potential losses if prices rise. 📉💀💵 | shorting, bearish trade, speculative selling

Volatility

• The degree of variation in the price of a financial instrument over time, reflecting its risk and uncertainty. High volatility indicates frequent and significant price fluctuations, while low volatility suggests stable prices. It is a key measure of market sentiment and investment risk. 🌪📉📈 | price fluctuation, market turbulence, risk measure