All the Terms Related to Market
Comprehensive glossary of stock market and investment terms to help you understand the financial world better.
Stock Market Learning Index
Complete guide to master stock market trading
Foundation Concepts
Stock Market Basics
What is stock market and how it works?
Market Terms
All important market terminology
Trade Types
Different types of trades
Trading Styles
Various approaches to trading
Candlestick Patterns
Bullish, Bearish & Continuation patterns
Chart Patterns
Technical chart analysis
Support & Resistance
Key price levels identification
Market Analysis
Technical, Fundamental & Price Action
Advanced Trading
Quick Reference
Use Ctrl+F (Cmd+F on Mac) to quickly search for any term on this page.
Market Basics
Stock
Stock is a share of ownership in a company. When you buy stock, you own a small part of that company. Stock can increase or decrease in value based on how well the company performs.
Share Holder
A shareholder is a person or entity that owns shares of a company. They have a claim on the company's profits and may benefit if the company does well.
Stock Exchange
A stock exchange is a place where stocks and other securities are bought and sold. It allows companies to raise money and lets investors trade shares. Examples include the National Stock Exchange(NSE)(in India), Bombay Stock Exchange(BSE)(in India), and NASDAQ(in US).
Public Company
A public company is a business that sells shares to the public on the stock market. Anyone can buy its shares and become a part-owner of the company.
Investment Terms
Portfolio
A portfolio is a collection of investments, like stocks, bonds, or real estate, owned by a person or organization. It shows what assets they have invested in.
Holding
A holding is an asset or investment that a person or company owns, such as stocks, bonds, or property. It represents their ownership in something.
Broker
A broker is a person or firm that helps people buy and sell investments, like stocks or real estate, for a fee or commission.
Brokerage
Brokerage is the fee or commission a broker charges for helping buy or sell investments, like stocks or property. It can also refer to the firm that provides these services.
IRAs
IRAs (Individual Retirement Accounts) are special accounts that allow you to save money for retirement with tax benefits. There are different types, like traditional and Roth IRAs, with varying tax advantages.
Hedge Fund
A hedge fund is an investment fund where experts manage money from wealthy people or institutions. They use advanced strategies to try to make high returns, often with higher risks.
Mutual Fund
Mutual funds are investment pools where many people combine their money to invest in a variety of assets, like stocks or bonds. It is managed by professionals to help spread the risk.
Index Fund
Index funds are a type of mutual fund that automatically invests in a wide range of stocks or bonds that track a market index, like the S&P 500. They aim to match the markets performance rather than beat it.
ELSS Fund (Equity Linked Savings Scheme)
ELSS is a type of mutual fund that invests mostly in stocks and offers tax benefits under Section 80C of the Income Tax Act. It has a 3-year lock-in period.
Financial Concepts
Capital
Capital is money or assets used to start or grow a business, invest, or make more money. It can include cash, equipment, or property.
Assets
Assets are things a person or business owns that have value. They can be used to pay debts, create income, or provide future benefits. Examples include cash, property, stocks, or equipment.
Liability
Liabilities are what a person or business owes to others, like debts or obligations. Examples include loans, bills, or mortgages.
Interest
Interest is the extra money you pay or earn for borrowing or lending money. For example, banks charge interest on loans and pay interest on savings.
Funding
Funding is providing money to support a business, project, or investment. It can come from investors, loans, or personal savings.
Compound Interest
Compound interest is the interest on a loan or investment that is calculated on both the initial amount and the accumulated interest from previous periods.
Market Indicators
Stock Index
A stock index is a group of stocks used to measure how a specific part of the stock market is performing. Examples include the Nifty-50, Sensex. It helps track the overall market trend.
Volume
Volume is the total number of shares, contracts, or assets traded in a market during a specific time. High volume shows more activity; low volume shows less activity.
OHLC
OHLC stands for Open, High, Low, and Close. It refers to the four key price points of an asset (like a stock) during a trading period: Open (the price when the market opens), High (the highest price during the period), Low (the lowest price during the period), and Close (the price when the market closes).
Trend
A trend is the general direction in which something, like a stock price or market, is moving over time—upward, downward, or sideways.
Gap Up & Gap Down Opening
A gap up happens when a stock opens at a higher price than its previous close, and a gap down happens when it opens at a lower price than its previous close.
Account Types
Demat Account
A Demat account is an electronic account used to hold and manage shares and other securities. It replaces the need for physical certificates and makes trading easier.
Trading Account
A trading account is an account used to buy and sell stocks or other securities. It allows you to place orders and track your trades.
Economic Terms
Recession
A recession is a period when the economy slows down. It means less business activity, higher unemployment, and lower spending.
Inflation
Inflation is when prices of goods and services rise over time, making money worth less. It means you can buy less with the same amount of money.
Supply & Demand
Supply and demand is an economic concept where the price of something is determined by how much of it is available (supply) and how much people want it (demand). If demand is high and supply is low, prices go up. If supply is high and demand is low, prices go down.
Market Conditions
Bull Market
A bull market is when the stock market is rising, and prices are going up. It shows strong investor confidence and optimism.
Bear Market
A bear market is when the stock market is falling, and prices are going down. It shows a period of pessimism and low investor confidence.
Investment Strategies
Investing
Investing is using money to buy assets like stocks, property, or businesses, hoping they will grow in value or provide income over time. In stock market buying and holding stock for long period of time is called investing.
Trading
Trading is buying and selling assets like stocks, goods, or currencies to make a profit from price changes. In stock market buying and holding stock for short period of time is called trading.
Intraday Trading
Intraday refers to trading that happens within a single day. It involves buying and selling assets like stocks or commodities during the same day, without holding them overnight. It offers leverage of upto 5 times also.
Swing Trading
Swing trading is a strategy where you buy and hold an asset for a few days or weeks to take advantage of short-term price changes or swings.
Averaging Down
Averaging down is when you buy more of an asset at a lower price than your original purchase, reducing the average cost of your investment. It's done when the price of an asset drops.
Value Investing
Value investing is a strategy where you buy stocks or assets that are undervalued, meaning their price is lower than their true worth, hoping the market will eventually recognize their value and the price will rise.
Growth Investing
Growth investing is a strategy where you buy stocks or assets of companies that are expected to grow quickly in the future, even if they are not profitable yet. The goal is to benefit from the price increase as the company grows.
Dollar Cost Averaging
Dollar-cost averaging is an investment strategy where you invest a fixed amount of money at regular intervals, regardless of the asset's price, which reduces the impact of market volatility.
SIP (Systematic Investment Plan)
SIP is a method of investing a fixed amount regularly in mutual funds. It helps build wealth over time through small, consistent investments.
SWP (Systematic Withdrawal Plan)
SWP is a strategy where you withdraw a fixed amount of money regularly from your investment, like a mutual fund, to provide steady income.
Lumpsum Investing
Lumpsum investing is when you invest a large amount of money all at once, rather than in smaller, regular amounts over time.
Income Investing
Income investing is a strategy focused on buying assets like dividend-paying stocks or bonds to earn regular income, rather than relying solely on price growth.
Diversification
Diversification is spreading investments across different assets or sectors to reduce risk. It ensures that a poor-performing investment doesn't affect the entire portfolio.
Risk & Volatility
Volatility
Volatility is how much and how quickly the price of something, like stocks or crypto, goes up or down. High volatility means big price swings; low volatility means small changes.
Beta
Beta measures how much a stock's price moves compared to the market. A beta of 1 means the stock moves with the market, while above 1 means more volatility, and below 1 means less volatility.
Market Characteristics
Liquidity
Liquidity is how easily something, like stocks or property, can be bought or sold without affecting its price. High liquidity means quick and easy trades; low liquidity means harder or slower trades.
Financial Instruments
Security
In finance, a security is a tradable financial asset, like stocks, bonds, or mutual funds, that represents ownership, debt, or rights to a portion of profits or assets.
Bond
A bond is a loan you give to a company or government. They promise to pay you back later with extra money (interest). It's like an IOU that earns you income.
ETFs
ETFs (Exchange-Traded Funds) are investment funds that hold a collection of assets, like stocks or bonds, and trade on stock exchanges. They allow you to invest in many assets at once.
Commodity
A commodity is a basic item or raw material, like gold, oil, or wheat, that is traded in bulk and has the same value regardless of who produces it.
REITs
REITs (Real Estate Investment Trusts) are companies that own, operate, or finance real estate properties. They allow investors to invest in real estate without having to buy property directly, and they pay out most of their income as dividends.
Coupon Rate
The coupon rate is the fixed interest rate paid by a bond issuer to bondholders, usually expressed as a percentage of the bond's face value.
Government Bonds
Government bonds are loans you give to the government in exchange for regular interest payments and the return of your money when the bond matures.
Corporate Bonds
Corporate bonds are loans made to companies. In return, the company pays you interest and repays the loan amount when the bond matures.
Returns & Income
Dividend
The amount of a company profits that are distributed to shareholders. Dividends are usually independent of the share price.
Return on Investment (ROI)
ROI measures the gain or loss from an investment relative to its cost. It's expressed as a percentage and helps assess the profitability of an investment.
CAGR (Compound Annual Growth Rate)
CAGR is the average annual growth rate of an investment over a specific period, assuming the growth happens at a steady rate each year.
Advanced Concepts
Leverage
Leverage is using borrowed money to increase the potential return on an investment. It means you can invest more than what you own, but it also increases the risk.
Derivatives
Futures
Futures are contracts to buy or sell an asset, like commodities or stocks, at a set price on a future date. It lets you agree on a price now, but the actual exchange happens later.
Options
Options are contracts that give you the right, but not the obligation, to buy or sell an asset at a set price before a certain date. They give you more flexibility than futures.
Call Option
A call option is a contract that gives you the right, but not the obligation, to buy an asset at a set price before a certain date. You use it if you expect the price to rise.
Put Option
A put option is a contract that gives you the right, but not the obligation, to sell an asset at a set price before a certain date. You use it if you expect the price to fall.
Derivatives
Derivatives are financial contracts whose value is based on the price of an underlying asset, like stocks, bonds, or commodities. Examples include options and futures contracts.
Swaps
Swaps are financial agreements where two parties exchange cash flows or other financial instruments, like interest rates or currencies, to manage risk or gain specific benefits.
Corporate Actions
IPO
An IPO (Initial Public Offering) is when a company sells its shares to the public for the first time, allowing people to buy ownership in the company.
Mainline IPO
A Mainline IPO is a standard initial public offering where a company lists its shares on a major stock exchange to raise capital from the public. It follows the usual process for going public.
SME IPO
An SME IPO is an initial public offering where small and medium-sized enterprises (SMEs) offer their shares to the public for the first time. It helps them raise capital, but typically involves less money and smaller companies compared to mainline IPOs.
FPO
An FPO (Follow-on Public Offering) is when a company that is already public sells more shares to raise additional capital. It happens after the company's initial IPO.
Share Pledging
Share pledging is when a shareholder offers their shares as collateral to borrow money. If the borrower does not repay, the lender can sell the shares.
Corporate Action
Corporate action refers to events initiated by a company that affect its stock or shareholders, like issuing dividends, bonus shares, stock splits, or mergers.
Bonus Share
Bonus shares are additional shares given by a company to its existing shareholders for free, based on the number of shares they already own.
Stock Split
A stock split is when a company divides its existing shares into multiple shares to make them more affordable while keeping the overall value unchanged. For example, in a 2-for-1 split, one share becomes two shares, each priced at half the original value.
Buy Back
A buyback is when a company repurchases its own shares from the market, reducing the number of shares available and potentially increasing the stock's value.
Right Issue
A rights issue is when a company offers existing shareholders the chance to buy more shares at a discounted price to raise funds.
Ex Date
The ex-date is the cutoff date to be eligible for benefits like dividends or bonuses. If you buy shares on or after this date, you won't qualify.
Acquisition
An acquisition is when one company buys another company, gaining control over it to expand business operations or market share.
Valuation Metrics
Market Cap
Market cap (market capitalization) is the total value of a company's shares of stock. It's calculated by multiplying the share price by the number of shares in circulation. It shows the company's size.
Unicorns
Unicorns are private companies valued at over $1 billion. They are often startups with rapid growth and high potential.
Intrinsic Value
Intrinsic value is the true, underlying value of an asset, based on factors like its earnings, growth potential, and overall worth, rather than its current market price.
Book Value
Book value is the value of a company's assets after subtracting its liabilities. It represents what the company would be worth if it were sold and all debts paid off.
Price-to-Book Ratio
The Price-to-Book (P/B) ratio compares a company's market value (price) to its book value. A low P/B ratio might suggest the stock is undervalued, while a high ratio could mean it's overvalued.
Face Value
Face value is the original value of a bond, stock, or currency printed on it, representing its worth when issued, not its current market value.
Earnings Per Share (EPS)
Earnings Per Share (EPS) is a measure of a company's profit, calculated by dividing its net income by the number of outstanding shares. It shows how much profit the company makes for each share of stock.
NAV (Net Asset Value)
NAV is the price of one unit of a mutual fund or ETF, calculated by subtracting liabilities from total assets and dividing by the number of units outstanding.
PE Ratio (Price-to-Earnings Ratio)
PE ratio shows how much investors are willing to pay for each unit of a company's earnings. It's calculated by dividing the stock price by earnings per share (EPS).
PEG Ratio (Price/Earnings-to-Growth Ratio)
PEG ratio adjusts the PE ratio by factoring in the company's growth rate. It helps assess whether a stock is overvalued or undervalued considering its growth potential.
Types of Stocks
Blue-Chip Stocks
Blue-chip stocks are shares of large, well-established companies with a history of stability, reliability, and strong performance. They are considered safe investments because they are less likely to fluctuate in value.
Penny Stocks
Penny stocks are low-priced shares of small companies, typically costing less than $5 each. They are risky investments because they can be very volatile and less stable.
Large Cap Stocks
Companies ranked 1st to 100th in terms of market capitalization. Large-cap stocks are shares of big, well-established companies with a market value of over ₹20000 crores. They are considered stable and less risky compared to smaller companies.
Mid Cap Stocks
Companies ranked 101st to 250th in terms of market capitalization. Mid-cap stocks are shares of companies with a market value between ₹5000 crores and ₹20000 crores. They are considered to have growth potential but carry more risk than large-cap stocks.
Small Cap Stocks
Companies ranked 251st onwards in terms of market capitalization. Small-cap stocks are shares of companies with a market value under ₹5000 crores. They are usually newer or smaller companies and can offer high growth potential but are riskier than larger companies.
Control Stock
Control stock refers to shares that give the owner significant influence or control over a company, typically through a large percentage of ownership or voting power.
Multibagger Stock
A multibagger stock is one that grows significantly in value, multiplying its original investment by several times, often due to strong growth potential.
Defensive Stock
Defensive stocks are shares of companies that remain stable and perform well even during economic downturns, like utilities or healthcare.
Trading Terms
Bid
A bid is the amount of money someone is willing to pay for an asset, like a stock or item, in a market or auction.
Ask
The ask is the price at which someone is willing to sell an asset, like a stock or item, in a market. It's the opposite of the bid price.
Bid-Ask Spread
The bid-ask spread is the difference between the highest price someone is willing to pay for an asset (bid) and the lowest price someone is willing to sell it for (ask). It represents the cost of trading in a market.
Position
In investing, a position refers to the amount of an asset, like stocks or bonds, that an investor owns or holds in the market.
Lot Size
Lot size refers to the minimum quantity of an asset that can be bought or sold in a single transaction. For example, in stocks, it could be 10 shares per lot.
Square Off
Square off means closing a trade by taking the opposite position. For example, if you bought a stock, you sell it to square off your position.
Financial Statements
Balance Sheet
A balance sheet is a financial statement that shows what a company owns (assets), owes (liabilities), and its net worth (equity) at a specific point in time. It helps assess the company's financial health.
Financial Statement
A financial statement is a document that shows a company's financial performance and position, including details like income, expenses, assets, and liabilities.
Quarterly Result
Quarterly results are reports a company releases every three months, showing its performance, including profits, revenues, and expenses.
Earnings Call
An earnings call is a meeting where a company's management discusses its financial results, performance, and future plans with investors and analysts.
Market Phenomena
Bubble
A bubble is when the price of an asset, like stocks or real estate, rises too quickly and becomes much higher than its real value. Eventually, the bubble 'pops,' causing prices to crash.
Short Squeeze
A short squeeze happens when the price of an asset that has been heavily shorted (bet against) starts rising quickly. Short sellers are forced to buy it back to limit their losses, which pushes the price even higher.
Black Swan
A Black Swan is a rare, unexpected event that has a huge impact, like a financial crash or a pandemic. It's hard to predict but can cause major changes.
Dead Cat Bounce
A Dead Cat Bounce is a temporary, small recovery in the price of a falling asset before it continues to drop further. It looks like a rebound but doesn't last.
Long Squeeze
A long squeeze happens when the price of an asset drops quickly, forcing traders who bought it (went long) to sell it to avoid losses. This selling increases the price drop even more.
Trading Positions
Going Long
Going long means buying an asset, like a stock or commodity, with the expectation that its price will go up. The goal is to sell it later at a higher price for a profit.
Shorting
Shorting (or short selling) is when you borrow and sell an asset, like a stock, hoping its price will fall. If the price drops, you can buy it back cheaper, return it, and make a profit. If the price rises, you lose money.
Short Selling
Short selling is when you sell an asset you don't own by borrowing it, hoping its price will drop so you can buy it back at a lower price and make a profit.
Order Types
Good Till Cancel Order
A Good Till Cancel (GTC) order is a type of order to buy or sell an asset that stays active until it is either executed or canceled by the trader, without an expiration date.
Market Order
A market order is an instruction to buy or sell an asset immediately at the current market price. It ensures a quick transaction but does not guarantee the exact price.
Day Order
A day order is an instruction to buy or sell an asset that is only valid for the current trading day. If it isn't executed by the end of the day, it is canceled automatically.
Limit Order
A limit order is an instruction to buy or sell an asset at a specific price or better. It won't be executed unless the market reaches the set price.
Stop-Loss Order
A stop-loss order is an instruction to sell an asset if its price drops to a certain level. It helps limit losses by automatically selling when the price falls too much.
Corporate Structure
Holding Company
A holding company is a company that owns enough shares in other companies to control them, but usually does not produce goods or services itself. Its main role is to manage investments.
Monopoly Company
A monopoly company dominates its market with little or no competition, controlling the supply of its products or services.
Market Participants
Whales
Whales are individuals or entities that hold a large amount of an asset, like cryptocurrency or stocks. Their trades can influence market prices because of their size.
Market Slang
To The Moon
'To the Moon' means expecting the price of an asset, like a stock or cryptocurrency, to rise significantly and quickly. It is often used in excitement or hype.
Tanking
Tanking means the price of an asset, like a stock or cryptocurrency, is dropping quickly and significantly.
Jigged Out
Jigged out refers to being forced to exit a trade, often at a loss, due to sudden market movements or unfavorable conditions.
Market Manipulation
Pump & Dump
Pump and dump is a dishonest scheme where the price of an asset, like a stock or cryptocurrency, is artificially inflated (pumped) by false information, and then sold off (dumped) quickly for a profit, leaving others with losses.
Rug Pull
A rug pull is a scam where developers of a project, like a cryptocurrency or NFT, suddenly take investors money and disappear, leaving the project worthless.
Insider Trading
Insider trading is the illegal practice of buying or selling a company's stock based on confidential information that is not available to the public. This gives an unfair advantage and is against the law.
Market Behavior
Panic Selling
Panic selling is when investors quickly sell their assets, like stocks, because they are scared prices will keep dropping. This often happens during market crashes or times of uncertainty.
Fees & Charges
DP Charges
DP charges are fees paid to a depository participant (DP) for holding and managing securities (like stocks) in an electronic form.
Statutory Charges
Statutory charges are fees or taxes that are required by law, such as stamp duty, service tax, or other government-imposed charges.
Expense Ratio
The expense ratio is the annual fee expressed as a percentage of a fund's average assets, covering costs like management and administration fees.
Exit Load
An exit load is a fee charged when you sell or redeem units of a mutual fund or investment before a certain period. It's meant to discourage short-term trading.
Markets
Forex
Forex (foreign exchange) is the market where currencies are traded. It involves buying one currency while selling another, like exchanging dollars for euros.
Primary and Secondary Market
Primary Market: The market where new shares or securities are issued directly by a company to investors (e.g., IPO). Secondary Market: The market where investors trade existing shares or securities among themselves (e.g., stock exchanges).
Financial Metrics
Profit Margin
Profit margin is the percentage of revenue that a company keeps as profit after expenses are subtracted. It shows how much profit the company makes from its sales.
AUM (Assets Under Management)
AUM is the total value of assets that a financial institution or investment manager manages on behalf of clients.
Cash Flow
Cash flow is the movement of money into and out of a business. It shows how much cash is generated and used during a specific period.
CFO (Cash Flow from Operations)
CFO is the cash generated from a company's main business activities, like selling products or providing services.
CFI (Cash Flow from Investing)
CFI shows cash spent or earned from buying or selling assets like equipment, property, or investments.
CFF (Cash Flow from Financing)
CFF shows cash raised or paid back through financing activities, like borrowing money, repaying loans, or issuing stock.
Free Cash Flow
Free cash flow is the cash left after a company pays for its operating expenses and investments. It shows how much money is available for dividends, debt repayment, or expansion.
Debt-to-Equity Ratio
This ratio shows how much debt a company has compared to its equity (shareholder funds). A high ratio indicates the company relies heavily on borrowed money.
ROCE (Return on Capital Employed)
ROCE measures how efficiently a company uses its capital to generate profits. It's calculated as operating profit divided by total capital employed (equity + debt).
Days Payable Outstanding (DPO)
DPO measures the average number of days a company takes to pay its suppliers. A high DPO means the company delays payments, keeping cash longer.
Analysis Methods
Technical Analysis
Technical analysis is the study of past market data, mainly price and volume, to predict future price movements of stocks or assets. It uses charts and indicators to identify trends and make investment decisions.
Fundamental Analysis
Fundamental analysis is the process of evaluating a company's financial health and value by looking at factors like its earnings, assets, debts, and overall business model. The goal is to determine if the stock is a good long-term investment.
Market Theory
Efficient Market Hypothesis
The Efficient Market Hypothesis (EMH) is the idea that all available information is already reflected in asset prices, meaning stocks or other assets are always priced correctly. This makes it impossible to consistently beat the market through buying and selling.
Taxation
Capital Gain Tax
Capital gain tax is the tax you pay on the profit earned from selling an investment like stocks or property.
STCG Tax (Short-Term Capital Gains Tax)
STCG tax is applied to profits from selling an investment held for a short period (usually less than a year). For stocks, it is typically taxed at 15%.
LTCG Tax (Long-Term Capital Gains Tax)
LTCG tax is applied to profits from selling an investment held for a longer period (usually more than a year). For stocks, gains above ₹1 lakh are taxed at 10%.