Terms used in Stock Market

If you want to start trading in stock market for earning then you should know about the terms used in stock market. Because if you do not know about the terms then you will not be able to undersstand the news, announcement or reports related to the stock market.

So here I am discussing the some important terms which are used in the stock market. You can check the books to read Click Here to find the best books to read.

Bull and Bear market

When market goes upward and its trend is upward then we can say its bull market and when market goes downward and tren is downward then we can say that it is bear market.

Annual reports

A company announces its annual report to attract its customer by showing its financial and management details about the company.

Bid price and Ask price

The price where we can sell the share that is called bid price and that price on which we can buy immediately that is ask price.

Buy/sell price

The price on which you bought your shares called Buy price and thw price on which you sold your shares called sell price. You can watch these your traded price on trade book after trade.

Order/order book

Order is the price where you want to buy or sell but price is not present immediatley so you will have to place a bid that means your order placed and when the price will come to your bid price then you trade will be done. You can see your order in order book option.

Trade/trade book

When you place a bid and your got the price, it is called trade. You can check your trades in trade book.

Net position

In this option you can check the quantity and name of shares and detail which you have in your account.

IOC

This is immmediate or cancel. In this option if there is price available in the market at the time when you bid then you trade will be done and if price not present then immediately the order will be cancelled.

AMO

This is after market order. This is for bid for the next day market. You can place you bid after market time till morning there some particular time period from then we can place the bid in exchange.

Capital gain/loss

How much profit or loss you earned from the trading this is called capital gain or loss. 

Market trend 

It means market is going upward or downward. The direction where market is going called market trend.

Upward and downward

These are directions like if market is increasing it means market is upward and if decreasing then it means market is going downward.

Portfolio

The portfilio means the stock holdings you have in your account which you have in different company's shares. Its is good make diversified portfolio.

Broker

A broker acts as an intermediary between the exchange and the investor. Its is an individual or a firm. Broker provides you the platform where you can buy or sell your shares.

Market order

When someone wants to buy or sell shares immediately on the current price which is reflecting on that time. Then the trade will be done immediately. It means you place market order and trade is done.

Long and short position

Long means when the position is from buy side that share bought but did not sold. And short means when share sare sold and the position is open.

Diversification 

Diversification means making your portfolio bigger by investing in different sectors company shares.  You can save yourself from a big loss by doing this.

Risk tolerance

Risk tolerance means the limit of bear the loss in share market. You should decide the limit of the loss if the shares goes in opposite way of your position.

Price movement

It shows the price fluctuation of the market or for the particular share. It will give the direction of price fluctuation. Understanding of price movement is very important.

Buyer and Seller

The buyer is the one who purchase the shares and the other side who sells the shares is called seller. Buyer and seller both are important for a trade. The trade is done when a person is buying any share and some one is selling it at the same. 

It is very simple, if some one wants to sell any product then he needs a buyer who is willing to buy that product at the price at which the seller wants to sell his product. That's why buyer seller both are important for any deal like today's deal at amazon Click here