Stock Market Glossary & Terms

All-Or-None (AON): A qualifier used to signify that no partial transaction is to be executed. The order will not be filled unless the full number of shares are available to be bought or sold at your requested price at the same time.

Ask: Price at which a security or commodity is offered for sale on an exchange or in the over-the-counter market. Generally, it is the lowest round lot price at which a dealer will sell.

Bid: Price a prospective buyer is ready to pay.

Bulletin Board Stock: A security that is not listed and traded on an organized exchange.

Commission: Fee paid to a broker for executing a trade based on the number of shares traded or the dollar amount of the trade.

Covered Calls: In options, the sale of a call contract while having the equivalent number of shares held back in case of exercise.

Day Trade: Executing a buy order and a sell order on the same stock within the same day.

In-the-Money: For a call option, the stock price is greater than the stock price. For a put option, the stock price is less than the strike price.

Index: Statistical composite that measures changes in financial markets. Indicies measure the ups and downs of stock, bond and commodities markets, reflecting market prices and the number of shares outstanding for the companies in the index. Some well-known indicies are the Dow Jones Averages, NYSE composite and the S&P 500 index.

Initial Public Offering: Corporation's first offering of stock to the public. IPO's are almost invariably an opportunity for the existing investors and participating venture capitalists to make big profits, since for the first time their shares will be given a market value reflecting expectations for the company's future growth.

Market Order: Order to buy or sell a security at the best available price. Most orders executed on the exchanges are market orders.

Naked Option: Option for which the buyer or seller has no underlying security position.

New York Stock Exchange (NYSE): The oldest and largest stock exchange in the U.S. An unincorporated association governed by a board of directors, which is headed by a full-time chairman and is composed of 24 individuals representing the public and the exchange membership in about equal portion. Trading hours occur between 9:30 a.m. and 4:00 p.m. EST, Monday through Friday, excluding market holidays.

Open Order: A buy, sell, buy to cover or sell short order that has been placed, but not executed.

Over-The-Counter (OTC): Market in which securities transactions are conducted through a telephone and computer network connecting dealers in stocks and bonds, rather than on the floor of an exchange.

Pink Sheet: An OTC Bulletin Board stock that is not quoted in the daily newspaper listings of Nasdaq Stock Market. "Pink Sheets" is a daily publication of the National Quotation Bureau that details the bid and ask prices of these stocks.

Prospectus: Formal written offer to sell securities that sets forth the plan for a proposed business enterprise or the facts concerning an existing one that an investor needs to make an informed decision.

Record Date: Date on which a shareholder must officially own shares in order to be entitled to a dividend.

Reverse Stock Split: Procedure whereby a corporation reduces the number of shares outstanding. The total number of shares will have the same market value immediately after the reverse split as before it, but each share will be worth more.

Settlement Date: Date by which an executed order must be settled, either by a buyer paying for the securities with cash or by a seller delivering the securities and receiving the proceeds of the sale for them.

Stock Split: Increase in a corporation's number of outstanding shares of stock without any change in the shareholder's equity or aggregate market value at the time of the split.

Stop Order: An order to buy or sell at the market price once the security has traded at a specific price called the stop price. For example, a stop order to buy, always at a price below the current market price, is usually designed to protect a profit or to limit a loss on a security already purchased at a higher price. The risk of stop orders is that they may be triggered by temporary market movements or that they may be executed at prices several points higher or lower than the stop price because of market orders placed ahead of them.

Accumulation/Distribution: Accumulation/Distribution (A/D): This is a momentum indicator that takes into account changes in volume and price. The idea is that a change in price coupled with an increase in volume will help confirm market momentum in the direction of a price change. The AD line is shown below the chart. If the indicator moves upward, buyers are driving the price; the security is being accumulated. If the indicator moves downward, sellers are driving the price; the security is being distributed.

Pump and Dump: Illegal practice where a small group of informed people buy a stock before they recommend it to thousands of investors. The result is a quick spike in stock price followed by an equally fast downfall. The perpetrators who bought the stock early sell-off when the price peaks at a huge profit. Most pump-and-dump schemes recommend companies that are OTCBB and have a small float. Small companies are more volatile and it's easier to manipulate a stock when there's little or no information available about the company.

Float: Float is the number of shares currently available for trading.

S-1: This filing is a pre-effective registration statement submitted when a company decides to go public. Commonly referred to as an "IPO" (Initial Public Offering) filing.

S-1/A: This filing is a pre-effective amendment to an S-1 IPO filing.

S-1MEF: Registration of up to an additional 20% of securities for any offering registered on an S-1.

S-2: This filing is an optional registration form that may be used by companies which have reported under the '34 Act for a minimum of three years and have timely filed all required reports during the 12 calendar months and any portion of the month immediately preceding the filing of the registration statement.

S-2/A: This filing is a pre-effective amendment to an S-2 filing.

S-2MEF: Registration of up to an additional 20% of securities for any offering registered on an S-2.x

S-3: This filing is the most simplified registration form and it may only be used by companies which have reported under the '34 Act for a minimum of twelve months and meet the timely filing requirements set forth under Form S-2. The filing company must also meet the stringent qualitative tests prescribed by the form.

S-3/A: This filing is a pre-effective amendment to an S-3 filing.

S-3MEF: Registration of up to an additional 20% of securities for any offering registered on a S-3.

S-3D: Registration statement of securities pursuant to dividend or interest reinvestment plans which become effective automatically upon filing.

S-3D/A: Amendment to a previously filed S-3D.

S-3DPOS: This filing is a post-effective amendment to an S-3D filing.

S-4: This filing is for the registration of securities issued in business combination transactions.

S-4/A: This filing is a pre-effective amendment to an S-4 filing.

S-4EF: Filed when securities are issued in connection with the formation of a bank, savings and loan, or holding company.

S-4EF/A: This filing is a pre-effective amendment to an S-4EF filing.

S-4 POS: This filing is a post-effective amendment to an S-4EF filing.

S-4MEF: Registration pursuant to Securities Act Rule 462(b) of up to an additional 20% of securities for an offering that was registered on a Form S-3.

S-8: This filing is required when securities are to be offered to employees pursuant to employee benefit plans.

S-8/A: Amendment to a previously filed S-8.

S-8 POS: This filing is a post-effective amendment to an S-8 filing.

S-11: Filing for the registration of securities of certain real estate companies.

S-11/A: This filing is a pre-effective amendment to an S-11 filing.

S-11MEF: Registration of up to an additional 20% of securities for any offering registered on a S-11.

S-20: Initial registration statement for standardized options.

S-20/A: Amendment to a previously filed S-20.

SB-1: An optional filing for small business issuers for the registration of securities to be sold to the public.

SB-1/A: This filing is a pre-effective amendment to an SB-1 filing.

SB-1MEF: Registration of up to an additional 20% of securities for any offering registered on a SB-1.

SB-2: Also an optional filing for small business issuers for the registration of securities to be sold to the public.

SB-2/A: This filing is a pre-effective amendment to an SB-2 filing.

SB-2MEF: Registration of up to an additional 20% of securities for any offering registered on a SB-2.

10-12B: A general registration filing of securities pursuant to section 12(b) of the Securities Exchange Act.

10-12B/A: Amendment to a previously filed 10-12B.

10-12G: A general registration filing of securities pursuant to section 12(g) of the Securities Exchange Act.

10-12G/A: Amendment to a previously filed 10-12G.

10SB12B: Filed for the registration of securities for small business issuers pursuant to section 12(b) of the Securities Exchange Act.

10SB12B/A: Amendment to a previously filed 10SB12B.

10SB12G: Filed for the registration of securities for small business issuers pursuant to section 12(g) of the Securities Exchange Act.

10SB12G/A: Amendment to a previously filed 10SB12G.

Ticker Symbol: This is the unique 3 or 4 letter name which identifies the stock for purposes of trading on a particular exchange. For example, the ticker symbol for Microsoft is MSFT. If you wish to obtain a stock quote online, you search for a company by its ticker symbol. If you don't know what a particular company's ticker symbol is, you can search for it by company name at most major financial sites such as Yahoo Finance.

Last Trade: The most recent price at which the security was traded. All quotes are updated continuously throughout the day as further trades are made.

Trade Time: The time of the most recent trade of a particular stock.

Change: The difference between the previous day's closing price and the most recent price of the stock.

Prev Close: The last trading price for the stock recorded when the market closed on the previous day.

Open: The price of the stock's first trade of the day. This is the price of the stock as of the market open. Trading opens at 9:30 a.m. Eastern Time.

Close: The close is the last trading price recorded when the market closed on the day.

Bid: The price at which a market maker or stock exchange trader is prepared to buy a particular security from an investor.

Ask: The price at which a market maker or stock exchange trader offers to sell a given security to an investor.

Day's Range: This refers to the price range at which the stock has traded at throughout the day. It represents the maximum and the minimum prices that investors have paid for the stock during a particular market day.

52wk Range:This refers to the price range at which the stock has traded at during the past 52 weeks. It represents the maximum and the minimum prices that investors have paid for the stock during the preceding one year period.

Volume: How many shares of a particular company traded that day.

Change: The difference between the previous day's closing price and the most recent price of the stock.

Market Cap: The value of a company as determined by multiplying the total amount of its outstanding shares by the current market price per share.

P/E: This is the company's Price/Earnings Ratio, calculated by dividing the current stock price by earnings per share from the last four quarters.

Dividend Per Share: This indicates the annual dividend payment per share for a company that currently pays out dividends.

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