Share Trading Dictionary - Glossary & Meaning of Share Trading Terms

Here is a dictionary and glossary of share trading terms and their meaning. These are most commonly used terms.

  1. Aggressive Strategy - Strategy to invest in stocks with aggression and  high risk with expectation of good return.
  2. Buy - To invest in shares of a stock for intraday trading, short-term investment or long-term investment.
  3. Sell - To sell a stock and book profit or loss.
  4. Hold - To hold a stock in portfolio for a longer period for a more or better return.
  5. Buy at Open - Placing a buy order before the market opens. The order gets executed at the current opening price.
  6. Capital Gain- Profit from the sale of an investment.
    Share Trading Dictionary
  7. Capital Loss- Loss from sale of an investment.
  8. Close a Position - To end an investment by selling or buying. Closing a long position requires selling, and closing a short position requires buying.
  9. Cover - To purchase a previously sold contract.
  10. Current Market Value -The current value of a portfolio.
  11. Day Trader - A stock trader who buys and sells stocks on the dame day.
  12. Day Trading or Intraday - Buying and selling stocks on the same trading day without taking possession of stocks for a long time.
  13. Diversification - Creating a portfolio by investing in several stocks, bonds and other investments.
  14. Equity - A stock or any other security representing an ownership interest.
  15. Fundamental Analysis - Examining the financial and managerial aspects of a company prior to investing.
  16. Growth Strategy -Investing in companies that are growing faster than its competitors.
  17. Hedge Fund - Fund for aggressive trading.
  18. IRA (Individual Retirement Account) -A tax-deferred retirement account for an individual that allows him to set aside up to $2,000 per year, with earnings tax-deferred until withdrawals begin at age 59 1/2 or later.
  19. Long-Term Investment - Investment money for a longer period.
  20. Limit Order - Buying or selling stocks on a fixed price rather than the current market price.
  21. Long Position - Buy  stocks from the long side with the expectation that prices will rise.
  22. Margin Account - An account with a brokerage company allowing an investor to borrow money from the broker to buy securities.
  23. Money Management -The art to manage money with investments, budgeting, banking, and taxes.
  24. Open a Position -To open an investment buy buying or selling. Opening a long position requires buying, and opening a short position requires selling.
  25. Overbought and Oversold Indicator - Tool to determine if stocks are oversold at higher rates. 
  26. Risk Management - The art to manage risk profile of an investor.
  27. Risk Tolerance -An investor's potential to handle risks in terms of investment.
  28. S&P 500 - A basket of 500 stocks that are considered to be widely held by investors.
  29. Short - The state of having sold a stock short without having covered it.
  30. Short Selling - Borrowing a security or commodity futures contract from a broker and selling it with the hope of making profit. All such securities must be later bought back and returned to the broker.
  31. Spread - Difference between the current bid and the current ask price of a stock.
  32. Technical Analysis - A method of evaluating securities through historical prices and other trading variables.
  33. Ticker Symbol - A system of letters used to uniquely identify a stock or mutual fund.
  34. Volatility - The relative rate at which the price of a stock moves up and down.
  35. Volume - The number of shares, bonds or contracts traded during a given period, for a security or an entire exchange.