Stock Market Glossary

A client account that uses credit from the investment dealer to buy a security. A client needs to deposit a margin amount with the balance advanced by the investment dealer against collateral such as investments. The investment dealer can make a margin call, which means the client must deposit more money or securities if the value of the account falls below a certain level. If the client does not meet the margin call, the dealer can sell the securities in the margin account at a possible loss to cover the balance owed. The investment dealer also charges the client interest on the money borrowed to buy the securities.

It is the total value of the issued shares of a publicly traded company; it is equal to the share price times the number of shares outstanding.

An order to buy or sell stock immediately at the best current price.

A stock’s average price-per-share during a specific period of time. Some time frames are 50 and 200 day moving averages.

A fund managed by an expert who invests in stocks, bonds, options, money market instruments or other securities. Mutual fund units can be purchased through brokers or, in some cases, directly from the mutual fund company.

The difference between the previous day’s closing price and the last traded price.

The difference between a company’s or individual’s total assets and its total liabilities. Also known as shareholders’ equity for a company.

A stock or bond issue sold by a company for the first time. Proceeds may be used to retire the company’s outstanding securities, or be used for a new plant, equipment or additional working capital. New debt issues are also offered by governments.

Whenever a company announces a book closure or record date, the exchange sets up a no-delivery period for that security. During this period only trading is permitted in the security. However, these trades are settled only after the no-delivery period is over.

A number of shares that are less than a board lot, which is the regular trading unit decided upon by the particular stock exchange. An odd lot is also an amount that is less than the par value of one trading unit on the over-the-counter market. For example, if a board lot is 100 shares, an odd lot would be 99 or fewer shares.

A market that has only buy orders or only sell orders booked for a particular security.

The net open positions of a futures or option contract.