ARBITRAGE

The concurrent purchase and sale of securities in different markets in an attempt to profit from short-term price disparities

ASK

The lowest price anyone wants to sell a security for, at a given time (the opposite of "bid").

ASSET ALLOCATION

The orderly placement of capital into various classes of investments, such as stock, bonds, real estate insurance, and cash equivalents.

ASSET BACKING

Net assets of a company divided by the number of issued shares.

AT THE MONEY

When the market price of the underlying security and an option's strike price are the same.

AUTHORISED SHARES

The maximum number of common and preferred shares that a company is authorised to issue.

AVERAGING DOWN

A strategy in which an investor the average price paid for a stock by purchasing more shares as the price declines.

BACKWARDATION

A futures market term to describe the situation when prices are progressively lower for successive delivery months. For example, the December contract is trading at 2079; March at 2056 and June at 2033. (The opposite situation is called "Contango".) 

BAR CHART

A chart on which each period's data is plotted as a vertical line joining the high and low prices for that time period. The opening price and the closing price are plotted as small horizontal dashes to the left and right of each bar, respectively. 

BEAR

A trader who expects the market to decline. 

BEAR MARKET

A declining market. 

BEAR TRAP (on chart)

When any technically unconfirmed down- move encourages traders and investors to sell. A bear trap sometimes precedes strong rallies and often catches the unwary. 

BETA

The relative volatility of a particular stock relative to the overall market as measured by the All Ordinaries Index. If a stock Beta coefficient is 1, it means its price rises and falls in direct relationship to the movement of the All Ordinaries Index. A Beta that is less than 1 indicates a stock is less volatile than the overall market; a Beta greater than 1 indicates that a stock is more volatile.

BID

The highest price at which traders are willing to buy a share, option or futures contract at a given time. (The opposite is called "ask".) 

BID PRICE

For stocks, the highest price at which a market maker offers to purchase a stock from a seller

BLUE CHIP STOCK

The shares of stable, profitable, and well-known public companies that have a long history of steady revenues and dividend payments.

BONUS ISSUE

The issue of bonus or free shares to existing shareholders, usually in a predetermined ratio. Eg. One bonus share for every five shares held.

BOOK VALUE

The theoretical value of the company that remains if all the asset of the company were liquidated at the values carried on the balance sheet and then all liabilities paid off. Intangible assets such as goodwill, patents, and copyrights are excluded from the total assets.

BREADTH OF THE MARKET

The number of individual stocks traded out of the number of stocks listed.

BREAKOUT

BROKER

A person who is paid a commission to execute your orders when buying or selling stocks, or options or futures contracts. 

BULL

A trader who expects the market to rise. [Also, untrue stories about one's trading successes!] 

BULL MARKET

An advancing (upward) market. A "bull" tosses market prices up.

BULL TRAP

When any technically unconfirmed move to the upside encourages buyers to be bullish. A bull trap usually precedes important declines and often fools those who do not wait for confirmation by other indicators. 

CALL

Often NO Liability (N.L) and sometimes Limited Liability (Ltd) companies have shares that are not fully paid. A call may be made for the payment for part, or all, of this outstanding capital. Holders of shares in a N.L. company may choose not to pay and forfeit their shares. Holders of shares in a limited Liability company are legally obliged to pay a call.

CALL OPTION

The right, but not the obligation, to buy a fixed amount of a given stock, or a fixed number of commodity contracts, at a specified price, within a specified time period. 

CAPITAL APPRECIATION

An increase in the market value of a security over the adjusted cost.

CAPITAL GAIN

The profit that results if the proceeds from the sale of a security are higher than the security's cost basis.

CAPITALISATION

That part of company's funds raised by issuing stocks and bonds.

CASH

Futures contracts are based on physical or financial commodities, such as gold, wheat or the S&P 500 Index. The market upon which a futures market is based is referred to as that contract's cash market. 

CHANNEL

In charting, a price channel contains prices throughout a trend. There are three basic ways to draw channels,  parallel, rounded, and channels that connect lows (bear trend) or highs (bull trend).

CHURNING

Excessive trading in a customer's account by a broker in order to generate commissions.

COMMISSION

The fee paid to your broker to buy or sell stocks, or options, or futures contracts. 

COMMODITY FUTURES CONTRACT

A legally-binding agreement to buy or sell a standardised amount of a given commodity, which is of a given quality, at a specific time, at a price determined in the trading pit. 

COMMODITY - FINANCIAL

This includes "commodities" such as share price index and currency contracts. 

COMMODITY - HARD

This includes commodities such as gold, silver and platinum. 

COMMODITY - SOFT

This includes commodities such as soybeans, oats and wheat. 

CONFIDENCE

The degree of assurance that a specified failure rate is not exceeded. 

CONGESTION

A series of trading days in which there is no significant, sustained, upwards or downwards movement in price. This market does not demonstrate a clear trend. (Also known as consolidation.) 

CONSOLIDATION

A pause that allows investors in a market to re-evaluate. (Also known as a congestion period).

CONTANGO

A futures market term to describe the situation when prices are progressively higher for successive delivery months. For example, the December contract is trading at 2033; March at 2056 and June at 2079. (The opposite situation is called "Backwardation".) 

CONTRACT

The basic unit that is traded in the futures markets. It represents a legally binding agreement between the buyer and seller of the contract. 

CONTRACT MONTH (far)

A contract whose expiration is second to occur. 

CONTRACT MONTH (near)

A contract whose expiration is first to occur. 

CONTRACT NOTE

Document sent by a stockbroker to a client confirming a purchase or sale, showing details of the transaction, price, brokerage and other changes involved.

CONTRIBUTING SHARE

A share that is partly paid, ie. The par value is not fully paid. (see Call)

CONVERSION

Ratio the number of common shares that an investor receives when converting a preferred stock or convertible bond.

CONVERTIBLE NOTES

A loan made to a company at a fixed rate of interest with the right to be either redeemed (ie. Repaid by the company) for cash or converted into ordinary shares on a predetermined date or within a certain period.

CONVERTIBLE PREFERRED

Preferred stock that shareholders can convert into a fixed number of common shares.

CORRECTION

Any price reaction within the market leading to an adjustment by as much as one-third to two-thirds of the previous gain. 

COST BASIS

The price, for tax purposes. Paid for a security, including commissions, mark-ups and other cost adjustments.

COVERING

Eliminating a short position by buying the share that have been sold short and delivering them to the lender.

CUM

Meaning "with", eg. "cum dividend" indicates that share are being traded with the current dividend attached and so the buyer rather than the seller receives it (see Ex.)

CUM-RIGHTS

Literally, with rights; describes transactions in which the pre-emptive rights accompany the purchase(or sale) of common stock and their value is included in the market price of the shares.

CYCLE

A variation where a point of observation returns to its origin. For example, a cycle could be from one major market peak to the next major market peak. 

DAILY RANGE

The difference between the high and low price during one trading day. 

DAY ORDER

An order to buy or sell securities without a time notation; if it is not executed or cancelled, it is not executed or cancelled, it expires at the end of the trading session during which it was placed.

DAY TRADER

A speculator who trades during the day, but closes out all trades before the close of each trading day. 

DEBENTURE

An unsecured corporate bond that is backed by the faith and credit of the issuer.

DEBENTURE

A loan made to a company for a fixed period of time at a fixed rate of interest. The loan is secured by a charge over the company's assets.

DEPOSIT

(Sometime called initial margin.) The amount taken from your trading account by your broker as a security deposit when a futures trade is initiated. The exchange Clearing House determines the minimum deposit required on the various commodities traded on that exchange. 

DISCOUNT

The amount by which the market value of a preferred stock or a corporate bond is below its par value.

DIVERGENCE

When two or more index averages or technical indicators fail to show confirming trends. 

DIVIDEND

An amount of money a company pays, per share held, to its shareholders. The money usually comes from the company's earnings. 

DIVIDEND IMPUTATION

Tax rule that enables shareholders to claim a tax rebate for the tax that a company has already paid on its profit. Dividends that include the right to a tax deduction are called "franked".

DIVIDEND REINVESTMENT

Plan a plan whereby a company's existing shareholders choose to have their cash dividend payments automatically reinvested in additional shares of the company's stock(DR).

DIVIDEND YIELD

The dividend return from a share investment.

DRAWDOWN

If you kept a chart of the balance of your trading account, the drawdown at anyone time would be the difference between the most recent peak and the balance at that time. 

DOLLAR-COST AVERAGING

A strategy whereby a person invests the same amount of money at regular intervals in a stock or a mutual fund without regard for the price fluctuations of the security.

DOWNTREND

The downward movement of a security's price, or of the market, as measured by a average or index over a period of time.

EARNINGS PER SHARE (EPS)

Company's net profit divided by the total number of shares in the company. Usually expressed as cents per share.

ELLIOTT WAVE

A pattern-recognition technique published by R. N. Elliott in 1939, which holds that the stock market follows a rhythm or pattern of five waves up and three waves down, to form a complete cycle of eight waves. 

EQUITY

Security more commonly called a share or a stock, it is represents a proportionate ownership of the business and the right to receive dividends.

EQUITY FUND

An unlisted fund that invests primarily in common and or preferred stocks.

EX-RIGHTS

Literally, without rights; describes transactions in which the presumptive rights do not accompany the purchase (or sale) of common stock. The rights at this time trade separately in the market.

EXRIGHTS DATE

By industry practice, the day after the distribution of the rights. The bid price of the stock is reduced by an amount equal to the value of the right.

EQUITIES

Shares, which represent part-ownership of a company, as distinct from debt securities such as bonds and debentures.

EX

Means "without", eg. "ex dividend" indicates the shares are being traded without the current dividend which is retained by the seller. Share trading without a current bonus or rights issue attached are also quoted "ex". (See Cum).

FIBONACCI RATIOS

The six important ratios in the series are 0.382; 0.500; 0.618; 1.000; 1.382 and 1.618. 

FIBONACCI SEQUENCE

The sequence of numbers (1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233...), rediscovered by the Italian mathematician Leonardo de Pisa in the 13th Century. This series is thought to have originated in Egypt and ancient Greece. 

FINANCIAL PROFILE

An assessment of an investor's assets, liabilities, investment objectives, and willingness to bear the risk etc.

FLOAT

The initial raising of capital by public subscription to shares in a company.

FLOOR BROKER

An exchange member and an employee of a member firm who executes buy and sell orders on the trading floor of an exchange.

FLOOR TRADERS

Traders who buy and sell on the floor (sometimes referred to as the "pit") of the futures exchange, either for their own account, or on behalf of a broker represented on the floor of the exchange. 

FORM READING

The ability to predict the likely future direction of a market using charts of that market. 

FULLY DILUTED EARNINGS PER SHARE

A calculation of the earnings per share taking into account all of the common shares currently outstanding plus any additional shares that could result from the conversion or exercise of any outstanding convertible preferred stock, convertible bonds, rights, or warrants

FUNDAMENTAL ANALYSIS

The study of a stock or commodity using factors that indicate the likely supply and demand of that stock or commodity. For stocks these factors can include the trend in earnings, the growth in market share of its products and the quality of the management of the company. For commodities such as wheat and soybeans, these can include the amount being cultivated, the likelihood of frost or floods and the likely demand at a particular time of the year. 

FUTURES CONTRACT

A futures contract is a legally binding agreement made between two parties to buy or sell a commodity (including a financial commodity) at an agreed price, on a specified date. Futures contracts are based on a standardised quality and quantity of the commodity. 

GOOD-TILL-CANCELLED (GTC)

An order given to a broker that remains a "live" order until it is either executed by the broker or cancelled by the client. Non-GTC orders remain "live" for the day they were placed. 

GLOBAL FUND

An equity fund that invests in the negotiable securities of corporations internationally.

GROWTH

HEDGERS

A hedger buys or sells futures contracts as a short- term alternative to buying or selling the actual commodity.  For example, a gold miner may sell gold futures contracts to fix the price of gold they will receive at some future date. 

HEDGING

Protecting against or limiting losses on an existing stock position by establishing an opposite position in the same or an equivalent security.

HOLDER

Buyer of an option contract.

INSIDE DAY

(See also "within day".) A bar on a daily bar chart that has a lower high and a higher low than the previous day. 

IN THE MONEY

In option trading, a phrase that describes an option that has intrinsic value. Specifically, an option is in the money when the relationship between the market price of the underlying security and the strike price of the option is such that exercising would yield a profit to the folder.  Index a composite measure of the movement of the overall market or of a particular industry that consists of a large number of stocks.

INITIAL

Margin requirement the percentage of a stock's market price that must be deposited when initially buying or selling short stock on margin.

INITIAL PUBLIC OFFERING

(PI) the first time that a company sells its stock to the public.

INTRINSIC VALUE

That portion of an option's premium reflecting the difference between the market price of the underlying security and the strike price of and option.

ISSUED

Outstanding authorised shares that have been distributed to investors and that may trade in the market.

JUNK BOND

A low-quality (rated BBC or lower), high-risk debt security.

LEVERAGE

The purchase (or sale) of a large amount of a security using a large percentage of borrowed money-for example, buying stock on margin.

LIMIT ORDER

An order to buy stock (buy limit) at a specified price or lower or to sell stock (sell limit) at a specified price or higher.

LINE CHART

A chart on which prices, usually the closing prices, are plotted as a series of points which are joined by a smooth curve. 

LIQUID

A market is said to be liquid if large quantities of the stock or commodity are able to be traded readily, with small price differences between successive trades. 

LISTED STOCK

A company whose stock meets the listing requirements of one of the exchanges and has been accepted by the exchange to trade on its floor.

LOCALS

Floor traders who are members of the exchange and trade their own account. 

LONG

Owning or buying a stock or commodity in anticipation of a rise in price. 

MANAGEMENT FEE

A percentage of an unlisted fund's total assets that the fund's portfolio manager charges for his or her services.

MANIPULATOR

A person or group of people who deliberately attempt to force a market to move in a particular direction. Manipulators were prevalent in the early part of this century. 

MARGIN

The amount taken from your trading account by your broker as a security deposit. The exchange Clearing House determines the minimum deposit required on the various commodities traded on that exchange. Your broker will make a "margin call", that is request an additional margin payment, if your unrealised loss exceeds the minimum margin required. 

MARGIN ACCOUNT

An account in which an investor buys (or sells short) securities by depositing part of their market value and borrowing the remainder from the brokerage firm.

MARGIN AGREEMENT

A document an investor must sign when opening a margin account. By signing it, the investor pledges the securities purchased as collateral for the margin loan, including the interest rate and how it will be computed.

MARGIN CALL

(See "Margin".) 

MARKET ORDER

An order to buy or to sell stock immediately at the best available market price.

MARKET VALUE

The price of a stock determined by the forces of supply and demand in the marketplace.

MOVING AVERAGE

A mathematical procedure to smooth or help to eliminate the fluctuations in data and to assist in determining a trend. 

NET WORTH

Stockholder's equity, the amount of a company's total assets that exceeds its total liabilities on the balance sheet; or for individual the difference between the total value of a person's assets and possessions (eg. home, land, saving accounts, investments) and total indebtedness (eg. mortgage, credit cards, school loans). 

NEW ISSUES

Securities offered for sale for the first time by an issuer in the primary market (for example, an initial public offering).

ODD LOT

A quantity of shares, the number of which is less than a marketable parcel. Odd lots can be bought and sold, but the transaction cost may be higher.

OFFER

The lowest price at which traders are willing to sell a share, option or futures contract at a given time. (The opposite is called "bid".) 

OPEN INTEREST (OPEN POSITIONS)

The total number of futures contracts in existence for a given delivery month, at a particular time. 

OPEN OUTCRY

A method whereby futures contracts are traded in trading pits by traders calling out their bids and offers. [Also, the wailing sound emanating from a trader after a large loss!] 

OPTION

The right, but not the obligation, to buy (call options) or sell (put options) a fixed amount of a given stock or a fixed number of commodity contracts, at a specified price, within a specified time period. 

ORDER (AT THE CLOSE)

A market order which is to be executed at, or as near to the close of the day's trading, as practicable. 

ORDER (AT THE OPEN)

A market or limited price order which is to be executed at the opening of the day's trading of the stock or commodity. 

ORDER (BEST)

An order to buy or sell a stated amount of a stock or commodity at the best price obtainable after the order is represented in the exchange. 

ORDER (MARKET)

An order to buy or sell a stated amount of a stock or commodity at the price at or near the price at which it is trading after the order is represented in the exchange. 

ORDER (STOP LIMIT)

A stop order which becomes a limit order after the specified stop price has been reached. The order can only be filled within a certain price range or limit. 

ORDER (STOP LOSS)

An order to buy or sell at the market, when the market trades at a designated price. Often called "stop loss" orders when placed to close out a position in the event prices go against the trader's existing position.  A stop order to buy must be entered above the prevailing market price. A stop order to sell must be entered below the prevailing market price. 

ORDINARY SHARE

The most commonly traded security in Australia. Holders of ordinary shares are part - owners of a company and may receive payments in cash, called dividends, if the company trades profitably.

OUT OF THE MONEY

In option trading, a phrase that describes an option with no intrinsic value. Specifically, an option is out of the money when the relationship between the market price of the underlying security and the option's strike price is such that the holder (buyer) will not exercise the option because it would result in a loss.

OUTSIDE DAY

A bar on a daily bar chart which has a higher high and a lower low than the previous day. 

OVERBOUGHT

Market prices that have risen too steeply and too fast. 

OVERSOLD

Market prices that have declined too steeply and too fast. 

PAPER TRADING

Carrying out all of the actions of preparing for, monitoring and evaluating a trade, without risking money by taking the trade. Paper trading helps you to master your trading system, but is not a true indication of how you would trade in reality, as the emotions of fear and greed are not present to affect your decision-making. 

PAPER PROFIT

The theoretical profit that would be made if a trade were closed out at a given price, or at a particular time. 

PAR VALUE

The fate value of the share, and the price at which it was issued if it is a fully-paid share (compare Contributing Share). Also known as nominal value.

PAR VALUE

For common stock, an arbitrary (and meaningless) value assigned the stock at the time it is issued.

PITS

Areas on the trading floor of a commodity exchange in which traders and brokers stand while trading commodities. [Also, the psychological state of a trader who has just been taken to the cleaners!] 

POINT

Futures prices are quoted in points and have a particular dollar value ascribed to one point (for example, US$12.50 for the Swiss Franc / U.S. dollar contract). A point is the mini- mum amount that a given futures price can change. 

POSITION

Having a trade in progress. You have a long position, for example, if you were a buyer of shares, call options or futures contracts. 

POSITION TRADER

A speculator who takes trades with the intention of holding the positions for days, weeks or longer.

PREFERRED STOCK

Stock issued by a company which entitles stockholders to a fixed dividend rate and gives them preference in terms of receiving dividends, and any assets of the company should it be liquidated. (Also called preference shares.) 

PREMIUM

The amount by which a security is quoted or issued above its par value.

PREMIUM

(1) the amount by which the market value of a preferred stock exceeds its Par value; (2) the market price of a call or a put option.

PRICE LIMITS

Some futures exchanges limit the amount a futures contract's price can rise or fall from the previous day's settlement price, in a single trading session. 

PRIMARY ISSUE

Another name for a new issue of securities.

PRIME RATE

The short-term interest rate that commercial banks charge their most credit-worthy business customers.

PREFERENCE SHARE

A share that ranks above ordinary shares, but below creditors and debenture holders, for claims on assets and dividends. These shares usually have a fixed dividend rate and only limited voting rights. There are several types of preference share.

PRICE EARNINGS RATIO

(P/E RATIO, PER) Shows the relationship between the market price of a company's shares and the earnings (or net profit) per share in he most recent year.

PROSPECTUS

PROSPECTUS

Document issued by a company setting out the terms of its public share issue or debt raising. Content is subject to the provisions of the Corporations Law.

PROXY

A form by which an investor votes in absentia by transferring voting authority to another party.

PUBLIC OFFERING PRICE

For stocks, the price at which new shares are sold to the public by the issuer or underwriters

PULLBACK

A move in the opposite direction to the main trend. 

PUT OPTION

The right, but not the obligation, to sell a fixed amount of a given stock or a fixed number of commodity con- tracts, at a specified price, within a specified time period. 

PYRAMIDING

To add additional contracts to an existing position, using part or all of the profits from the initial position as margin. 

RALLY (RECOVERY)

Prices moving in an upward direction after a decline. (The opposite is a "reaction".) 

RANGE

The difference between the high price and the low price for a given period. 

REACTION

Prices moving in a downward direction after an advance. (The opposite is a "rally".) 

REALISED GAIN

The cash profit resulting from the liquidation of a stock position

REGISTERED SECURITIES

(1) securities that are registered and held in customer's name at a brokerage firm; (2) Securities that are registered with the Securities and Exchange Commission.

RESISTANCE

A price level at which rising prices have stopped rising and have either moved sideways or reversed direction; usually seen as a price chart pattern. 

RETAINED EARNINGS

The portion of the earnings per share that the board of directors does not pay out as dividends to the shareholders. Retained earnings are reinvested in the company.

RETRACEMENT

A swing in the opposite direction to the main trend. 

RIGHTS ISSUE

A method of raising capital whereby existing shareholders are offered the right to buy new shares in the company. Shares are issued in a predetermined ratio, eg. One right for every five shares held. Rights are sometimes traded on the Stock Exchange.

RIGHTS OFFERING

An offering of new shares to existing shareholders. The method and terms by which pre-emptive rights are distributed to existing shareholders are explained in the prospectus that accompanies the offering.

RISK ARBITRAGE

The simultaneous purchase and sale of the shares of two companies in anticipation of or upon the announcement of a merger or acquisition.

S&P 500

The Standard and Poor's composite stock price index. The weighted average of 500 stocks, consisting of 400 industrial, 40 financial, 40 utility and 20 transportation stocks. 

SCALPER

Someone who trades short, quick moves in the market with the intention of gaining frequent, small, quick profits. 

SECURITIES

Refers to the various types of investment offered by a company or government body, such as shares, debentures and bonds.

SCREEN

A computer or television screen that displays live data (current bid; offer; open; high; low; close) or charts. 

SCREEN JOCKEYS

Traders, both institutional and private, who make their trading decisions while watching live screens, as opposed to trading on the floor of the exchange. 

SECTION

A major market move. Gann said that bull markets usually make three, and sometimes four, upward sections. Each section usually takes weeks, and sometimes months, to unfold. 

SECONDARY MARKET

The over-the-counter dealer market. In the over-the-counter market, securities are priced by dealers and not necessarily traded by an open auction process at an exchange. 

SELLING SHORT

Strategy investors use to profit from a price decline; involves selling securities that the investor has borrowed with the intention of repurchasing them later at a lower price.

SENTIMENT INDICATORS

Statistics used to measure the bullish or bearish mood of the market and it's investors.

SETTLEMENT

Typically the closing price. 

SHARE

An equity or part ownership of a company.

SHARE CERTIFICATE (SCRIP)

A document with an identifying number that states that the person is the registered holder of a number of securities.

SHARE PRICE INDEX (S.P.I.)

A futures contract based on the Australian All Ordinaries Index. 

SHORT

SHORT COVERING

To cover shorts is to purchase the number of futures contracts necessary to buy back the same number of contracts in the same delivery month as those previous sold. 

SOLD OUT BULL

A person who is basically bullish but has taken most of his/her profits out of the market and finds it difficult to re-establish long positions. 

SOLVENT

In the black! Able to pay all debts as they become due. 

SPECULATOR

A person who anticipates the future market movements of stocks, options and/or commodities with the intention of trading them for a profit. 

SPOT MARKET

The current cash (or underlying physical) market for commodities. 

STOCK

A security representing ownership of a company and entitling its owner to the right to receive dividends.

STOCK BROKER

Stock Exchange member who buys and sells shares and other securities for clients.

STOCK EXCHANGE

An auction market in which exchange members 'meet' in a central location to execute buy and sell orders for individual and institutional customers.

STOCK SPLIT

An increase in the number of a company's authorised shares that result in no change in the total value of the investor's holdings.

STOP ORDER

An order that becomes a market order to buy (buy stop) or to sell (sell stop) when the stock trades at a specified price, known as the 'stop price.' Also called a 'stop-loss order.' 

STRIKE PRICE

The fixed price at which stock can be bought or sold when a call or put is exercised. Also known as the 'exercise price.'

SUPPORT

A historical price level at which falling prices have stopped falling and either moved sideways or reversed direction; usually seen as a price chart pattern. 

SWINGS

TAKE A BATH

TAPE

Tape refers to "ticker tape". Brokers' offices used to have machines that spat out a tape that recorded the latest stock prices. 

TAPE READER

Tape readers where people who could make buying and selling decisions by watching the fluctuations of prices as they were printed on the tape. Today we sometime call a person who is skilled at chart reading, a good "tape reader". 

TECHNICAL ANALYSIS

The analysis of the market based on a study of price action. A technical analyst studies charting factors such as price patterns, price support and resistance, time cycles, volume and open interest, in an attempt to predict subsequent market action. 

THIN MARKET

A market in which there are few bids to buy, or offers to sell, or both. Very light trading in securities. 

TICK

The minimum price move of a stock.

TICKER

The machine that printed the ticker tape of stock prices in brokers' offices. Today brokers use live screens. (See "Screens".) 

TIME VALUE

The part of an option's price, in excess of its intrinsic value, which represents the value of the time left before the option expires. 

TOTAL RETURN

The percentage return, including both dividends and capital appreciation, on money invested in a stock.

TRADE

A transaction; either the purchase or sale of securities. 

TREND

A sustained movement in one direction. An upward trend is defined as successive higher tops and higher bottoms on a swing chart. "The trend is your friend." 

TREND REVERSAL

A change in the direction of the trend. From an up trend to a down trend, or from a down trend to an up trend. 

UNDERWRITER

A brokerage firm that assists the issuer of a new security in setting the offering price and in marketing securities to the public.

UNLISTED STOCKS

Virtually synonymous with over-the-counter stocks, a term used to describe any stock or other security that does not trade or is not listed on an exchange

UNREALISED GAIN

The profit resulting from an increase in te value of a security position that is still being held.

UPTREND

The upward movement of a stock's price or of the market as measured by an average or index over a period of time.

VOLATILITY

The relative amount or percentage by which a stocks price rises and falls over a period of time.

VOLUME

The number of shares or contracts traded in a security or an entire market during a given period. [Also, the level of sound emanating from a trader after a large loss!] 

WARRANT

A long term security, usually attached to a bond or preferred stock, that gives the warrant holder the right to buy a fixed number of a company's shares at a price that is set higher than the stock's current price at the time of issuance.

WASTING ASSET

A security that becomes worthless on a predetermined expiration date. Rights, standard warrants, and options are securities that are wasting assets.

WEIGHTING

The method for determining the worth of each company's stock relative to the value of the overall index.

WHIPSAW

Small quick movements up and down, which result in money being lost on both sides of a price swing. 

WITHIN DAY

(See also "inside day".) A bar on a daily bar chart that has a lower high and a higher low than the previous day. 

WRITER

Term for a seller of options.