Equity: Equity refers to the ownership interest that shareholders have in a company. It is the difference between the company's total assets and total liabilities.
Bull Market: A bull market is a period of rising stock prices and overall optimism in the market. It is typically characterized by increased buying activity and positive investor sentiment.
Bear Market: A bear market is a period of declining stock prices and overall pessimism in the market. It is marked by increased selling activity and negative investor sentiment.
Index: An index is a statistical measure of the performance of a group of stocks representing a particular market or sector. Examples include the S&P 500, Dow Jones Industrial Average (DJIA), and Nasdaq Composite.
Volatility: Volatility refers to the degree of price fluctuations in a stock or the overall market. High volatility indicates significant price swings, while low volatility suggests more stable prices.
Bid and Ask: The bid price is the highest price a buyer is willing to pay for a stock, while the ask price is the lowest price a seller is willing to accept. The difference between the bid and ask price is known as the spread.
Market Order: An order to buy or sell a stock at the best available price in the market at the time the order is placed.
Limit Order: An order to buy or sell a stock at a specified price or better. For a buy limit order, the price must be at or below the specified limit price. For a sell limit order, the price must be at or above the specified limit price.
Stop Order (Stop-Loss Order): An order that becomes a market order once the stock reaches a specified trigger price. It is used to limit losses or protect profits.
Short Selling: Short selling is a strategy where an investor borrows shares and sells them with the expectation that the stock's price will decline. The investor aims to buy back the shares at a lower price to return them to the lender and profit from the difference.
Long Position: Holding a long position means owning stocks or securities with the expectation that their value will increase over time.
Day Trading: Day trading involves buying and selling securities within the same trading day, with no overnight positions.
Margin Trading: Margin trading allows investors to borrow funds from a broker to buy stocks, leveraging their buying power. It involves using margin accounts and carries higher risks.
Volume: Volume refers to the total number of shares or contracts traded in a security during a given period. High volume indicates active trading.