OF STOCK MARKET TERMS
– an investor who
anticipates a falling market and, therefore, sells the security in the hope of
buying it back at a lower price.
Chip – A large
well-established company with a history of profitable operation.
securities, which entitle the holder to a pre-determined return during their
life and repayment of principal at maturity.
investor who anticipates a rising market and,
therefore, buys the security in the hope of
selling it later at a higher price.
Gains Tax – Tax
payable on profit arising from appreciation in value of investment, realized at
the time of selling or maturity of investment.
repurchase transactions, better known, as “Badla”; these are an established
form of transactions used in the stock market for temporary financing of trades
by speculators and jobbers.
– That part of a
company’s profits which is distributed among shareholders, usually expressed
in rupee per share or percentage to paid up capital.
per share (EPS) – A
profitability indicator calculated by dividing the earnings available to common
stockholders during a period by the average number of shares actually
outstanding at the end of that period.
– The owners’
interest in a company’s capital, usually referred to by ordinary shares.
– The occasion when
a company’s shares are offered on the stock market for the first time.
managers – A
company, which invests and manages investors’ money, with the aim of
maximizing capital growth.
Public Offering (IPO) – The
offering of equity shares of a company to the general public for the first time.
trading – The
purchase or sale of shares by someone who possesses ‘inside’ information on
a company’s performance which information has not been made available to the
market and which might affect the share price. In Pakistan, such deals are a
companies – A
company, which issues shares and uses its capital to buy securities and shares
in other companies.
company – A company
whose securities are admitted for listing on a stock exchange.
position - When an
individual purchases securities of a company he is said to have a long position
in the company’s shares. For example an owner of shares in PTCL is said to be
"long PTCL" or "has a long position in PTCL." If you are
long, you would like the share price to go up.
capitalization – The
total value of a company’s equity capital at the current market price.
– A person or
company holding securities on behalf of others, but who is not the owner of such
– The right (but not
the obligation) to buy or sell securities at a fixed price within a specified
shares – The most
common form of shares, which entitle the owners to jointly own the company.
Holders may receive dividends depending on profitability of the company and
recommendation of directors.
– A collection of
ratio (P/E ratio) –
The P/E ratio is a measure of the level of confidence (rightly or wrongly)
investors has in a company. It is calculated by dividing the current share price
by the last published earnings per share.
market – Where a
company issues new shares, either for the first time, or at the time of issuing
– Conversion of a
state-owned company to a public limited company (plc) status.
limited company (plc) –
A company whose shares are offered to the general public and traded freely on
the open market and whose share capital is not less than a statutory minimum.
Issue – The issue of
additional shares to existing shareholders when companies want to raise more
– A broad term for
shares, corporate bonds or any other form of paper investment in capital market
– Once a deal has
been made, the settlement process transfers stock from seller to buyer and
arranges the corresponding exchange of money between buyer and seller.
Selling- The act of
borrowing stock to sell with the expectation of price reduction with the
intention of buying it back at a cheaper price.
– A member of the
stock exchange who deals in shares for clients and advises on investment
Market – The market
place where shares of publicly listed companies are bought and sold.
trust – An
open-ended mutual fund that invests funds in securities and issues units for
sale to the public. It can repurchase these units at any time.
– The aggregate
return earned on an investment taking into account the dividend/interest income
and its present capital value.