Financial Market Glossary

The American Association of Individual Investors weekly sentiment survey measuring the percentage of individual investors who are bullish, bearish, or...

A market breadth indicator that measures the cumulative difference between advancing and declining stocks, providing insight into overall market parti...

A market breadth indicator that compares the number of advancing stocks to declining stocks, providing insight into the underlying strength or weaknes...

The practice of simultaneously buying and selling identical or equivalent securities in different markets to profit from price differences, helping en...

The strategic distribution of investment capital among different asset classes (stocks, bonds, cash, etc.) based on investment goals, risk tolerance, ...

A sustained period of declining stock prices, typically defined as a 20% or greater decline from recent highs, characterized by investor pessimism and...

A sustained period of declining stock prices, typically defined as a 20% or greater decline from recent highs, characterized by investor pessimism and...

A measure of a stock's volatility relative to the overall market (S&P 500), where beta > 1 indicates higher volatility and beta < 1 indicates lower vo...

A measure of a stock's volatility relative to the overall market, where beta greater than 1 indicates higher volatility and beta less than 1 indicates...

A technical analysis tool consisting of a moving average with upper and lower bands set at standard deviations above and below, used to measure volati...

A debt security where investors lend money to an entity (corporate or governmental) for a defined period at a variable or fixed interest rate.

A powerful market breadth indicator that occurs when the 10-day moving average of advancing issues divided by total issues rises above 61.5%, historic...

Technical analysis technique focused on identifying when prices move decisively above resistance or below support levels, often accompanied by increas...

A sustained period of rising stock prices, typically defined as a 20% or greater increase from recent lows, characterized by investor optimism and eco...

A sustained period of rising stock prices, typically characterized by investor confidence, economic growth, and widespread optimism about market prosp...

The profit realized from the sale of an asset when the selling price exceeds the purchase price, subject to capital gains tax based on holding period.

The statistical relationship between commodity prices and other financial instruments, economic indicators, or currencies, helping investors understan...

Interest calculated on the initial principal and accumulated interest from previous periods, creating exponential growth over time and considered the ...

Economic indicator measuring consumers' optimism about the economy and their personal financial situation, important for predicting consumer spending ...

A measure that examines the weighted average of prices of a basket of consumer goods and services, used to track inflation and cost of living changes.

Market signals that suggest doing the opposite of prevailing sentiment or trends, based on the principle that extreme consensus often coincides with m...

Debt securities issued by corporations to raise capital, typically offering higher yields than government bonds due to increased credit risk.

Statistical measurement of how two or more securities or asset classes move in relation to each other, ranging from -1 to +1, essential for portfolio ...

An assessment of the creditworthiness of a borrower (individual, corporation, or government), indicating the likelihood of default on debt obligations...

The yield difference between corporate bonds and government bonds of similar maturity, reflecting the additional risk premium investors demand for cor...

The relative value of one currency compared to others, measured through exchange rates and currency indices, affecting international trade, corporate ...

Shares of companies whose earnings and stock prices closely follow economic cycles, performing well during expansions but declining during recessions ...

The practice of buying and selling securities within the same trading day, with all positions closed before market close to avoid overnight risk.

Shares in companies that provide essential goods and services with stable demand regardless of economic conditions, offering steady dividends and lowe...

A risk management strategy that involves spreading investments across various assets, sectors, or geographic regions to reduce overall portfolio risk.

A payment made by corporations to shareholders from company profits, typically paid quarterly and representing a return on investment separate from ca...

The annual dividend payment as a percentage of the current stock price, measuring the income return on an investment from dividends alone.

The annual dividend payment as a percentage of the stock price, indicating the income return on investment from dividend-paying stocks.

An investment strategy where fixed dollar amounts are invested at regular intervals regardless of market conditions, reducing the impact of volatility...

A weighted measure of the US Dollar's value against a basket of six major foreign currencies (EUR, JPY, GBP, CAD, SEK, CHF), providing a broad gauge o...

A company's net profit divided by the number of outstanding shares, serving as a key profitability metric for fundamental analysis and valuation calcu...

The period each quarter when most public companies report their quarterly earnings results, typically occurring in January, April, July, and October.

The inverse of the P/E ratio, calculated as earnings per share divided by stock price, expressed as a percentage to compare stock returns with bond yi...

Developing economies with rapid growth potential but higher volatility and risk, characterized by improving infrastructure, increasing market capitali...

An investment fund that trades on stock exchanges like individual stocks but holds a diversified portfolio of assets, combining features of mutual fun...

The annual fee charged by mutual funds and ETFs, expressed as a percentage of invested assets, covering management fees and operational costs.

A composite sentiment indicator that measures market emotions from extreme fear (0) to extreme greed (100), combining multiple market metrics to gauge...

The central banking system of the United States, responsible for monetary policy, interest rate decisions, and financial system stability, with signif...

The total monetary value of all finished goods and services produced within a country's borders, serving as a primary indicator of economic health and...

An investment strategy focused on companies expected to grow at an above-average rate compared to other companies, often paying premium prices for fut...

Market cycles where investor preference alternates between growth stocks (companies with high earnings growth) and value stocks (undervalued companies...

A type of mutual fund or ETF designed to track the performance of a specific market index, offering broad diversification with low fees and passive ma...

The rate at which the general level of prices for goods and services rises, eroding purchasing power and typically measured by the Consumer Price Inde...

Investments that tend to maintain or increase their value during periods of rising inflation, protecting purchasing power when currency values decline...

The first sale of stock by a private company to the public, allowing the company to raise capital from public investors and begin trading on stock exc...

Legal trading by corporate insiders (executives, directors, employees) in their company's stock, which must be reported to regulators and can provide ...

The degree to which different country stock markets move together, important for global diversification strategies as correlations tend to increase du...

An order to buy or sell a security at a specific price or better, providing price control but not guaranteeing execution if the target price isn't rea...

The ease with which an asset can be bought or sold in the market without significantly affecting its price, with higher liquidity indicating more acti...

Assessment of how easily and quickly an asset can be bought or sold without significantly affecting its price, measuring market depth, bid-ask spreads...

The practice of borrowing money from a broker to purchase securities, using the investment account as collateral, which amplifies both potential gains...

A measure of how many stocks are participating in a market move, typically comparing advancing vs declining stocks to assess the internal health and s...

Market Capitalization is the total value of a company's shares, calculated by multiplying share price by the number of outstanding shares, used to cat...

The total value of a company's outstanding shares, calculated by multiplying the current stock price by the number of shares outstanding, used to cate...

A decline of 10% to 20% in stock prices from recent highs, considered a normal and healthy market adjustment that helps prevent excessive speculation.

A decline of 10% to 20% in stock prices from recent highs, considered a normal and healthy pullback that can help prevent excessive speculation and bu...

Theory that financial markets incorporate all available information into prices quickly and accurately, making it difficult to consistently achieve re...

The sectors, stocks, or asset classes that are leading market performance during specific periods, indicating where investor capital is flowing and pr...

A firm or individual that provides liquidity to markets by continuously quoting buy and sell prices, profiting from the bid-ask spread while facilitat...

An order to buy or sell a security immediately at the current market price, guaranteeing execution but not guaranteeing a specific price.

The overall attitude and emotional state of investors toward a particular market or security, reflected in trading activity, survey data, and various ...

Investment strategy attempting to predict future market movements to optimize buy and sell decisions, though research shows consistent market timing i...

Technical analysis tools that measure the rate of change in price movements, helping identify the strength of trends and potential reversal points by ...

A technical indicator that smooths price data by creating a constantly updated average price over a specific time period, commonly used to identify tr...

An investment vehicle that pools money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities, managed by profe...

The per-share value of a mutual fund or ETF, calculated by dividing total assets minus liabilities by the number of outstanding shares.

Daily count of stocks reaching new 52-week highs versus new 52-week lows, providing insight into market breadth and the underlying health of market tr...

Measures of investor sentiment derived from options trading activity, including put/call ratios and volatility skew, providing insights into market ex...

Market conditions where securities have moved too far in one direction relative to their fundamental value or technical indicators, suggesting potenti...

Price-to-Earnings ratio compares a company's current share price to its per-share earnings, used to determine if a stock or market is overvalued or un...

A valuation metric comparing a company's current share price to its earnings per share, indicating how much investors are willing to pay for each doll...

A profitability ratio measuring what percentage of revenue becomes profit, calculated as net income divided by revenue, indicating a company's efficie...

The ratio of put options trading volume to call options trading volume, used as a contrarian sentiment indicator where high ratios suggest bearish sen...

Interest rates adjusted for inflation, representing the true cost of borrowing or return on lending in purchasing power terms, crucial for asset valua...

A significant decline in economic activity typically lasting several months, characterized by falling GDP, rising unemployment, and reduced consumer s...

Market regimes characterized by alternating periods of investor risk appetite (risk-on) favoring growth assets, and risk aversion (risk-off) preferrin...

The additional return investors require for taking on extra risk compared to risk-free investments, compensating for uncertainty and potential losses ...

A momentum oscillator that measures the speed and change of price movements on a scale of 0-100, used to identify overbought (>70) and oversold (<30) ...

The Relative Strength Index is a momentum oscillator that measures the speed and change of price movements on a scale from 0-100, used to identify ove...

Investments that tend to retain or increase in value during periods of market stress, uncertainty, or economic turmoil, providing portfolio protection...

The movement of investment capital from one market sector to another as investors seek to capitalize on different economic cycles and market condition...

A trading strategy where investors borrow and sell shares they don't own, hoping to buy them back at a lower price and profit from the decline.

A corporate action where a company divides existing shares into multiple shares, reducing the price per share while maintaining total market value and...

An order designed to limit losses by selling a security when it reaches a predetermined price level, helping investors manage risk and protect profits...

Key technical analysis concepts where support represents a price level where buying interest emerges, and resistance represents a level where selling ...

Key technical analysis concepts where support represents a price level where buying pressure prevents further decline, while resistance is where selli...

A trading strategy that holds positions for several days to weeks, aiming to profit from short-term price movements and technical patterns.

Short-term US government debt securities with maturities of one year or less, considered the safest investment and often used as a benchmark for risk-...

Technical analysis method that identifies and follows the direction of price movements over time, using trend lines, moving averages, and momentum ind...

The percentage of the labor force that is jobless and actively seeking employment, serving as a key indicator of economic health and labor market cond...

An investment strategy that involves picking stocks that appear to be trading for less than their intrinsic value, popularized by Benjamin Graham and ...

The CBOE Volatility Index measures the market's expectation of 30-day volatility based on S&P 500 index options, often called the 'fear gauge' of the ...

A measure of how much an asset's price fluctuates over time, with higher volatility indicating greater price swings and potentially higher risk and re...

A pattern in options implied volatility where out-of-the-money options have higher implied volatility than at-the-money options, creating a smile-shap...

The study of trading volume patterns to confirm price movements and identify potential trend changes, based on the principle that significant price mo...

A graph showing yields of bonds with different maturity dates, typically comparing short-term vs long-term treasury rates to assess economic expectati...