Above par Above nominal value
Allotment The number of shares allotted to a subscriber of a new issue of shares
Arbitrage The purchase of shares in one market and the almost simultaneous sale in another
Bear A person who sells shares expecting the price to decline
Bear market A market in which the price trend is declining
Blue chip The shares of a company with good management and excellent financial performance
Bond A document evidencing a debt whereby the borrower agrees to pay the lender (bondholder) specified interest for a fixed time period and to return the principal sum on maturity date
Bonus shares Additional shares issued free to existing shareholders in proportion to their current holdings
Book Closing Date The date when the shareholder records of a company are closed for registration for the purpose of determining entitlement of dividends, bonus, or right issues
Book Value The value as indicated in the financial statement
Bull A person who buys shares expecting the prices to rise
Bull Market A market in which the price trend is rising
Brokerage A fee, fixed by the Stock Exchange, charged by the stockbroker for the service of buying or selling
Call Option A negotiable contract whereby a seller (called the writer) for a certain sum of money (option premium) gives the buyer the right to buy from him within a specified time period, a specified number of shares at a pre-determined price (striking or exercise price)
Captial gain Profit from the sale of capital assets
Chartist A person who relies on the price charts to make investment decisions
Convertible Bond A bond that may be exchanged for a specified number of shares of the issuing company
Corner To control the shares of a company so that they cannot be obtained for delivery except at the terms set by the group which has cornered the market
Cum bonus issue The price quoted includes the current bonus issue (see Ex Bonus Issue)
Cum dividend The price quoted includes the current dividend (see Dividend)
Cum right issue The price quoted includes the rights issue
Dealers representative Person with a dealer representative license granted under the Securities Industry Act and authorized to deal in securities
Debenture Money borrowed by a company with a charge on its properties
Dividend Payment made by a company to its shareholders as a return on their capital
Exercise Price The specified price at which the warrant may be exercised to purchase the underlying share
Exercise Ratio Number of Warrants required by investor to exercise in order to receive one underlying share
Expiry The date on which a warrant expires, and becomes worthless if not exercised
Ex Bonus Issue Excluding bonus issue (see also Cum bonus issue)
Ex dividend Excluding dividend (see also Cum dividend)
Ex rights issue Excluding right issue (see also Cum rights issue)
Float a share issue To issue shares in order to raise capital
Fundamentalist A person who relies on economic and financial analysis in investment decision making
Growth stock Stock of company which is growing earnings faster than its industry or the overall market
Hot money Short term capital moving from one location to another in search of quick profits
In the Money Situation in which a warrant exercise price is below the current market price of the underlying share
Listed shares Shares quoted and traded at the stock exchange
Odd lot Number of shares which is smaller than the normal trading lot (for Bursa Malaysia, less than 100 shares)
Out of the Money Situation in which exercise price is higher than the market price of the underlying share
Overcapitalized A company which has too much capital and is unable to generate enough profit to provide a fair rate of return on its capital
Oversubscribed In a new issue of shared, the applications received exceed the amount offered for sale
Paper profits Profit that has not been realized
Portfolio The whole range of securities held by an investor
Premium/Discount The percentage(%) difference by which the sum of the warrant price and the exercise price exceeds the underlying share price. The warrant is said to be trading at a premium (discount) when the percentage diffence is positive (negative). Warrant trading at huge discount are often considered attrative
Profit taking Converting paper profit into realised profit
Rally A price recovery in the market following a period of decline
Right issue Rights given to existing shareholders to subscribe to additional shares at a fixed price
Suspend trading Prohibiting the trading of the shares of a company
Underlying Share A share subjected to delivery upon the exercise of a warrant
Unit trust a financial institution set up to poll the financial resources of small investors and invest the funds in securities by professional fund managers
Warrants Securities entitling the warrant holder the right to purchase a specific amount of the underlying share at a fixed exercise price. The profit from exercising the warrant is the amount by which the underlying share price exceeds the sum of the cost of warrant and the exercise price
END: Leng (28 Apr 2016)
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