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15 May 2012

BCRW Important market terms

1. Market-- According to prof.Chapman market is not a place but a commodity or commodities and buyers and sellers of such commodities who are in direct competition with one another.
2. Bull-- A bull is a speculator who buys the goods or securities at low price with the intention of making heavy profit by selling them at high price. He always expects that price will rise in future. The difference between the new price and the old price creates his profit. In American market, a bull is known as “long”.

3. Bull campaign / Bull Activity, Bull support-- An effort of the bull to influence the price by different artificial means is known as ‘bull campaign’ or ‘bulling the market’. A bull buys forward with the hope that the prices will rise in future but future is always uncertain. Sometimes his hopes fall flat and the prices either decrease or remain static.
4. Bullish / Bull Factor, Bull Sentiment, Long Side of the Market, Bull Outburst, Bullish Activity
When there is a general expectation of rise in prices in future the market is called bullish. The upward trend of prices in the market is the result of bull campaign. A bull operator buys goods and securities with the intension of making profit by selling them at a high price in future.
5. Trapped Bull-- Sometimes a bull makes heavy purchases with the intention of making heavy profit. When other speculators come to know about his over purchased position, they join hands and stay out of the market or refuse to buy from him. Ultimately, the bull has to sell to them at any price they offer.
6. Bear-- The speculator who expects a fall in prices in future is called a bear. He sells his stock at present when the prices are higher and buys at cheaper rates in future. Thus the difference of the two prices creates his profits.
7. Bear Raid-- When a number of bears try to decrease the prices by artificial means, it is called bear raid. A bear sells at present when the prices is high and buys in future when the prices falls.
8. Bearish-- This term refers to the tendency of the market when the prices of the commodities are falling. In this situation the price level goes down by bear raid.
9. Squeezed / Trapped Bear-- Sometimes a bear makes heavy forward sale with the intention of making heavy profit. The other speculators come to know about his oversold position and date of delivery. They join hands against him and do not sell the specific goods or securities to him. Ultimately the day of delivery comes and the bear has to purchase any price.
10. Bear Covering-- When bear’s speculations are proved wrong and the price of a specific item does not fall, the bear is bound to buy the goods to fulfill his promises and contracts.
11. Stag-- A person who buys newly issued stock of shares hoping to sell them quickly for profit is called stag.
12. Lame Duck of the Market-- When prices fall, the companies which suffer more and which are saved from complete destruction by government support are called lame duck or lame duck of the market.
13. Blue Chips-- This term is used for the shares of well-established and sound companies, enjoying good reputation in the market. Investment is considered so safe that there is a little risk of losing either capital or income.
14. Market Value ----- Market value is the price of a commodity, which a dealer expects to get in the market. The market value is an average value of a commodity in short-term market.
15. Market Price-- The market price is the price, which is actually paid in the current market dealings. Market price is generally determined by two factors, i.e., demand and supply.
16. Street Price-- Sometimes when the stock exchange is closed, the selling of securities is done outside the exchange at a privately quoted price. This is known as street price.
17. Demurrage-- The daily charges made for the detention of a ship beyond the agreed number of days is called demurrage. This term is also used for the daily charges made for the detention of a railway bogie.
18. Dumping-- A sale of goods to a foreign market at a price much lower than the current market price is called dumping. This is done to capture the foreign market. This is a word of competition where everyone tries to excel the next party. Dumping is the best technique to be prominent in the market.
19. Arrival-- Fresh stock of goods brought to the market on a particular day is called arrival. This does not includes the old stock. Arrivals are quoted in the market reports to indicate an increase in the supply of goods.
21. Arbitrage-- It is an operation in which a person buys the goods at a low price from a cheap market and sells the same in another market for higher profit. The chance of profit depends upon two factors.
-          Knowledge of prices prevailing in the different markets.
-          Quick means of transportation.
22. Ex-ship-- After paying all the cost, if the buyer takes delivery at the dock, it is called ex-ship.
23. Ex-factory / Ex-Warehouse-- It means that the buyer takes the delivery at the seller’s factory or warehouse. It means that the buyer pays all the cost for conveyance from warehouse.
24. Peggling or Pegging-- When the rate is artificially maintained at a certain level mainly by manipulation of price, it is called Peggling.
25. Clogging-- Clogging means blocking. It is a situation when the market is saturated with surplus funds, which block the normal operation of business.
26. Strading / Stradding-- When the market operators take advantage of abnormal differences in the rates of different bills in the same market and carry on arbitrage operation by selling one kind of bills to buy another kind of bills.
27. Haggling-- Haggling means bargaining. It is a normal practice in which every buyer tries his best to bring the price down and every seller makes an effort for high profit. It is a prominent clement of retail market.
28. Rigging-- In a market whenever a number of bulls organize themselves and try to control the market by bogous transactions in order to manipulate the prices of commodities in their favour, it is called rigging.
29. Hedging-- shield against the loss. It is a system in which the speculator protects himself unfavourable movements of price fluctuation. He tries to save himself with different tricks such as shifting some part of loss to the shoulders of others.
30. Off Take-- This term refers to the total purchase of a creation commodity in the market during the specified period. It includes both ready and future deliveries.
31. Turn Over-- The total amount of transactions done in a particular period is called turn over. This term also includes total sales in terms of amount of money or quantity of goods.
32. Boom-- A period of rising and heavy business is called boom. This period gives us prosperity and economic stability as the prices, wages, production, employment and investment hit the highest point.
33. Recession /Dips-- A decline in business characterized by a fall in prices is called recession.
34. Depression-- It is the period in which business activity is at a very low point. The prices are very low. The profit margin is nominal and the investors become inactive. As a result there is a high level of unemployment.
35. Recovery-- Recovery is a phase in the trade cycle when the economy returns to its normal levels of investment and employment after depression or disaster.
36. Flat-- Low price almost touching the bottom level is called flat.
37. Shade-- It means little rise in prices with narrow margin. It exits only for a shorter period of time.
38. Set Back-- If the market suddenly experiences the effect of low prices in the form of a sudden fall in the volume of transaction. It is termed as set back. It usually happens after a good business.
39. Easy-- It indicates decreasing prices or low prices prevailing in market.
40. Dull-- This term is used to describe the state of the market when a little business is done during a specified period. It is also known as stagnant of the market.
41. Volume of Business-- This term shows amount of business done in a market during a specified period. Whenever small business is done, it is known as dull, stagnant etc. if heavy business is done, the term brisk or broad will be used.
42. Nature of Business-- It indicates the terms and conditions of the delivery of goods bought or sold. Whenever the goods bought or sold are to be delivered after a month or at a future date. It is called Forward or Future.
43. Tendency / Undercurrent / Undertone-- It indicate the movement of prices. An upward trend of prices shows goods whereas downward trend shows bad condition prevailing in the market.
44. Speculation-- Selling of goods or securities in the hope of marking profit from the changing of prices is called speculator.
45. Buoyancy-- It indicates better tone of the market with increasing tendency of prices.
46. Dividend-- This refers to the variable return paid on investment. Profits of a company divisible among its members are also dividends. It is different from fixed return that is termed as interest.
47. Power of Attorney-- Document in which one person authorizes another to act on his behalf in respect of matters specified in the documents.
48. Subdued Note-- It shows that the tendency of the market is downward.
49. Bearer Securities-- These are the securities which are freely transferable by mere delivery and the possession is the legal proof of ownership. Such securities are Bearer Bonds, Shares Warrants and Bear Stock.
50. Borrow Over-- This phrase refers to more borrowers than lenders in the money market. There is an excess of demand over supply of money.
51. Bull Factor / Bullish Factor-- Any factor or reason that contributes to the rise in price, or which is likely to raise the price in the market.
52. Bill of Sale-- A document which transfers the right in some personal properties from one person to another. It is generally given as security for a loan.
53. Balance Sheet-- A statement of property and assets, capital and liabilities and the balance of profit and loss account which is prepared to show the financial position of a business concern over a given period.
54. Bearer Cheque-- A Cheque on which after the name of the payee, the words or bearer are written. The proceeds of such a cheque is payable to any person who presents it to the banker.
55. Crossed Cheque-- A cheque with two paralleled transverse lines drawn on it. To collect the proceeds of such cheque, the holder must deposit it to his banking account.
56. Cash on Delivery-- These words denote that a buyer must pay for the goods at the time of delivery.
57. Depreciation-- The gradual shrinkage in value of any assets due to wear and tear; the fall in market price of anything.
58. Gross Profit-- The difference between the cost of the goods that have been sold and the proceeds of their sale, without any deduction.
59. Invoice-- A statement which gives full particulars of quantity, quality and prices of goods sold.
60. Mortgage-- A conveyance of property as security for a debt which is lost if the money or interest due thereon is not paid on the expiry of a certain period.
61. Scheduled Bank-- The bank whose name is included in the schedule of the Central Bank of a country upon fulfilling certain conditions.
62. Overdraft-- The amount by which withdrawals exceed deposits or the extension of credit by a lending institution to allow for such a situation.
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