Commonly Used Terms

• Share: A share of ownership in a company.
• Market capitalization: The total value of a company's outstanding shares.
• Dividend: A portion of a company's earnings that is paid out to shareholders.
• Earnings per share (EPS): The amount of a company's profit that is allocated to each outstanding share of its stock.
• Price-to-earnings ratio (P/E ratio): A valuation ratio that compares a company's current share price to its earnings per share.
• Face Value: Face value of a stock is the nominal value of a company's shares as specified in its charter. It is also known as par value, and it is the initial value at which a company issues its shares. Face value is used to determine the minimum price at which a stock can be traded.
• 52 Week High: The 52-week high is the highest price at which a stock has traded over the past 52 weeks, or one year. This information is useful for investors to track the performance of a stock over a longer time period and to understand its volatility.
• 52 Week Low: The 52-week low is the lowest price at which a stock has traded over the past 52 weeks, or one year. This information is useful for investors to track the performance of a stock over a longer time period and to understand its volatility.
• All Time High/Low: The all-time high/low is the highest and lowest price at which a stock has ever traded since its inception or the time period being considered. This information can be useful for investors to track the performance of a stock over a longer time period, and to understand its historical volatility. The all-time high/low can also be used as a benchmark for investors to evaluate a stock's potential upside or downside.
• Upper and Lower Circuit: Upper and lower circuit limits are price limits that are set by stock exchanges to prevent excessive volatility in the prices of stocks. The upper circuit limit is the maximum price at which a stock can be traded in a day, and the lower circuit limit is the minimum price at which a stock can be traded in a day. When a stock hits either the upper or lower circuit limit, trading in the stock is halted for a certain period of time, usually a few minutes, to allow the market to stabilize. Circuit limits are put in place to prevent extreme price movements in either direction that may be caused by sudden news or market conditions. They also prevent market manipulation by limiting the ability of traders to artificially drive up or down a stock's price.
• Volume: The number of shares traded in a particular time period.
• Bid: The price that a buyer is willing to pay for a stock.
• Ask: The price that a seller is willing to accept for a stock.
• Spread: The difference between the bid and ask price.
• Blue chip stock: A stock of a large, well-established company with a long history of steady earnings growth.
• Penny stock: A stock that trades at a very low price.
• Growth stock: A stock of a company that is expected to grow at a faster rate than the overall market.
• Value stock: A stock that is believed to be undervalued by the market.
• Bull market: A market where prices are generally rising.
• Bear market: A market where prices are generally falling.
• Short selling: The sale of a stock that the seller does not own, with the hope of buying it back at a lower price.