| 52-Week High | The 52-week high of a security or an index refers to the highest value or price achieved by it in the past year (or preceding 52 weeks). |
| 52-Week Low | The 52-week low of a security or an index refers to the lowest value or price achieved by it in the past year (or preceding 52 weeks). |
| Accumulation | It is when many traders and investors are buying a security in large amounts, showing optimism. It signals potential for price increase. |
| Acid Test Ratio | Acid test ratio is used to calculate short-term liquidity availability in a company. The formula to calculate the same is as follows: Acid test ratio= (Cash & Cash equivalents + Marketable securities + Account Receivables) / Total Current Liabilities |
| Advances | The number of securities from a sector or index that have increased in price during a specific period of time. |
| After Market () | (AMO) helps you place an beyond regular trading hours. They are on the next trading day. |
| Algorithmic Trading | Algorithmic trading is when computers follow specific instructions (algorithms) to automatically trade in financial markets, using data analysis and patterns. |
| Alpha | Alpha is the excess return generated on any investment in comparison to a benchmark index. |
| American Depositary Receipt (ADR) | It is a mechanism through which US depository banks can list stocks of companies not registered in US, on US exchanges like NYSE and NASDAQ. These stocks are denominated in dollars and their are also reflected in the same. |
| Amortization | Amortization is an accounting method used by companies to spread out the expenses incurred for acquiring a long term asset over a period of time (typically as long as the asset is in use), for taxation purposes. For eg: If a company acquires machinery for say ₹1 crore which will be used for next 10 years today, then instead of showing the expense incurred towards this in one financial year in the accounting books, they will show ₹10 lakh as an expense over next 10 years |
| Analyst Recommendations | Analyst recommendations are professional opinions on whether to buy, sell, or hold the stock. |
| Annual General Meeting (AGM) | Annual General Meeting is a corporate event where the management gives a brief about the functioning of the company or organization to general shareholders. Voting on important matters pertaining to the company may also take place in an AGM, like appointment of directors, declaration of dividend, appointment of auditors, etc. |
| Annual Report | It is a report which gives a comprehensive review of a company or organisation’s acitivities and financial data in the preceding financial year. |
| Annuity Investment | An annuity investment is an option that can provide a guaranteed income for an individual or their spouse throughout their retirement. They are purchased for a set period and payout a specific amount in retirement based on the investment strategy and amount invested. |
| Arbitrage | Arbitrage is the simultaneous purchase and sale of the same or similar asset in different markets in order to profit from tiny differences in the asset’s listed price. It exploits short-lived variations in the price of identical or similar financial instruments in different markets or in different forms. For example : A stock which is listed on both BSE is trading at ₹100 while the same stock is trading at ₹103 on NSE. In this case an arbitrage opportunity of ₹3 is available as you can buy the stock from BSE at ₹100 and sell it for ₹103 thus making ₹3 in the transaction. |
| Ascending Triangle | An ascending triangle is a bullish continuation pattern. It forms when there’s an uptrend in prices, and the market experiences a consolidation phase characterized by higher lows forming a rising trendline, and relatively flat highs forming a resistance level. |
| Ask Price | It is the price quoted by the sellers of a security at which they are willing to sell a specified quantity of that security. |
| Asset Allocation | Asset allocation is the act of dedicating portions of your investments to different asset classes in a manner consistent with an investment strategy. |
| Asset Management Company (AMC) | An asset management company (AMC) is a firm that professionally manages and invests funds collected from its clients in stocks, bonds, real estate, commodities, etc. |
| Asset-backed securities | An asset-backed security (ABS) is a financial investment that is backed by an underlying pool of assets as collateral. It works like a bond, paying fixed income until it matures. |
| ATR | Average True Range (ATR) is a technical indicator to measure the volatility or range of price movements of a stocks, commodities, or currencies, over a specified period. It is a moving average of the true range (TR) over a certain number of periods. |
| Authorised Capital | The authorised capital of a company is the maximum amount of capital for which can be issued by a company. It is mentioned in the Memorandum of Association of the Company. The company can increase the capital at any time with shareholders’ approval and by paying an additional fee to the Registrar of Companies. For example, if a company has an authorized capital of ₹10 lakhs, it can issue shares up to that value to investors. However, it can issue shares for an amount less than ₹10 lakhs if needed. |
| As per SEBI regulations, all brokers must transfer idle funds from the user’s trading account back to their linked bank account on the first Friday of either the month or quarter as a part of the account settlement process. | |
| Bad debt | Bad debt refers to debt that someone borrowed but is unlikely to pay back. When debts are considered bad, they are treated as losses and written off against a reserve. |
| Balance Sheet | A financial statement that shows a company’s assets, liabilities, and shareholders’ equity, providing insights into its financial position. |
| Balanced Fund | A balanced fund is a mutual fund that includes both equity and debt in the portfolio schemes. Generally, 40-60% are in the form of equity and the rest in the form of debt. |
| Base Interest Rate (Benchmark Interest Rate) | It is a key rate set by a country’s central bank or monetary authority serving as a reference point for determining the interest rates in the economy. It is the minimum interest rate investors will demand investing in non-Treasury security (corporate bonds, municipal bonds, etc). |
| Basis Point | A basis point is a standard measure for interest rates and other percentages in finance. One basis point equals 1/100th of 1%, or 0.01%. Basis points are typically expressed with the abbreviations bp, bps, or bips. |
| Bear Market | A bear market is a trend of falling stock prices or indices for an extended period. Usually, if stock prices or indices have fallen at least 20% from the previous high, it is considered a bear market. |
| Bearish | Being bearish means having a negative view on the price or future performance of an asset or market, expecting it to go down. |
| Beta | Beta is a concept that measures the expected move in a stock relative to movements in the overall market. A beta greater than 1.0 suggests that the stock is more volatile than the broader market, and a beta less than 1.0 indicates a stock with lower volatility. |
| Bid (Buying) Rate | It is the price quoted by the buyers of a security at which they are willing to buy a specified quantity of that security. |
| Bid (Buying) Rate | The bid–ask spread is the difference between the prices quoted for an immediate sale (ask) and an immediate purchase (bid) for any security in live market. When the bid price matches with ask price then a order goes through for that specific quantity. |
| Billing Cycle | The billing cycle is the period between the last billing date and the current billing date for any sale of goods or provision of services. The length of billing cycles varies depending on the manufacturer or service provider. |
| Black-Scholes Model | It is a differential equation widely used to value option contracts. The Black-Scholes model requires five input variables: the strike price of an option, the current stock price, the time to expiration, the risk-free rate, and the volatility. |
| Block Trade | A block trade is a privately negotiated securities transaction that involves a substantial number of shares or a high value. These trades are usually executed outside of the regular market and involve institutional investors or big players in the financial industry. |
| Blue-Chip Stock | Blue-chip stocks are stocks of companies with large market capitalization, sound financials and good reputation. |
| Bollinger Bands | A Bollinger Band is a technical analysis tool used to measure the volatility of a stock’s price. It is plotted as two standard deviations, above and below the simple moving average (SMA) of a security’s price |
| Bond ETFs | Bond ETFs are exchange-traded funds (ETFs) that invest in bonds. In India, you can find bond ETFs that invest in government securities and private bonds. Bond ETFs are passively managed and track bond indices. |
| Bond Rating | Bond Rating determines the creditworthiness of a bond. Rating agencies like CARE, ICRA, CRISIL, and Fitch assess the bond issuer’s creditworthiness and give them a rating. A higher rating indicates a lower risk of default, while a lower rating means a higher risk of default. |
| Bonds | Bonds are instruments through which governments and corporations borrow money. Bondholders are creditors or lenders and the issuer of the bond is the debtor or borrower. Bondholders can receive fixed interest rates, or the bonds may be issued at a discount and paid in full at maturity. |
| Bonus Issue | Bonus issues are when companies give existing shareholders free additional shares based on their past profits. This increases the number of outstanding shares and may attract more retail investors. However, it doesn’t directly increase shareholder wealth as the per-share price may drop due to the increased number of shares. |
| Book Building | Book building is a process used to set the price of an before it’s offered to the public. The underwriter gathers and records investor demand for shares to determine the issue price. |
| Book Value | The book value of a company is calculated by subtracting its external liabilities from its assets. It literally means the net worth of the company as reflected on its balance sheet. |
| Book Value/Share | The book value of a company is calculated by subtracting its external liabilities from its assets. It literally means the net worth of the company as reflected on its balance sheet. Book Value/Share is ratio of book value to the number of outstanding shares |
| Bottom Line | Bottom line refers to the net income that a company generated after sales and expenses are considered. The word bottom in the term depicts the location of the net earnings or the net income in the income statements, i.e., the last line of the bottom of the page. |
| Breakout | It refers to a price movement in which a security breaks through an established support or resistance level, signaling a potential trend reversal or a continuation of the existing trend. |
| BSE | Bombay Stock Exchange (BSE) is one of the 2 major stock exchanges in India. Having been established in 1875, BSE is Asia’s first stock exchange. In addition to enabling the trading of equities, BSE also provides a market for currencies, debt instruments, derivatives and mutual fund units. Indian Clearing Corporation and BSE Institute are subsidiaries of BSE. |
| Bull Market | A bull market is a trend of rising stock prices or indices for an extended period. Usually, if the stock price or indices have risen at least 20% from the previous low, it is considered a bull market. |
| Bullion | Bullion is a name given to precious metals like gold, silver, and platinum in their purest form. Bullion is generally sold in the form of ingots, bars and unmarked coins. Value of bullion is derived from the quantity and purity of the used metal and not its casted shape. |
| Bullish | Being bullish means having a positive view on the price or future performance of an asset or market, expecting it to go up. |
| Buy Side Analyst | Buy side analysts are analysts who research stocks and other securities in primary and secondary markets which can generate good returns employed by companies that deploy funds in the market for their clients. They use fundamental analysis, track sectoral growth and news to find the right investment opportunities. |
| CAGR | CAGR is the measure of an investment’s annual growth rate over time, with the effect of compounding taken into account. |
| Candlestick | A type of chart that displays the open, high, low, and close prices for an asset over a timeframe using a rectangluar shapes which resembles a candlestick. The green candle represent a closing price greater than opening price while a red candle represents a closing price lower than the opening price. The wick of candle represents the highest or lowest point reched by the security during the timeframe. |
| Capital Expenditure (CapEx) | The money spent by a company to acquire or upgrade its physical assets or invest in long-term projects. It is important for a company’s growth, helping them expand production, work better, or enter new markets. |
| Capital Gains Tax | Capital gains tax is a tax on profits made from selling of assets. There are two types: short-term capital gains tax and long-term capital gains tax, depending on how long the asset was held before selling. |
| Cash & Cash Equivalents | Cash and cash equivalents are those assets in the company’s balance sheet that are held in cash in banks or such investments which are highly in nature and can be converted into cash in a very short amount of time. Eg: Bank FDs, commercial paper, money market funds etc. |
| Cash Flow | The amount of cash generated or consumed by a company’s operating, investing, and financing activities. |
| CDSL | Central Depository Services (India) Limited (CDSL) is one of the 2 depositories in India. Depositories enable the holding of securities in dematerialised form and transaction of securities. The company describes itself as a market infrastructure institution (MII) and provides services to exchanges, clearing corporations, depository participants (DPs), issuers, and investors. |
| Central Bank | A country’s central bank is the primary authority that manages the currency of a country and controls its supply in the economy. As a result affecting key interest rates, inflation and GDP growth rates. In India Reserve Bank of India functions as a central bank. |
| Circuit | The upper circuits and lower circuits are the highest and lowest market prices a stock can trade at on a given trading day respectively. |
| Clearing Corporation | A clearing corporation is a organization that manages the confirmation, settlement, and of transactions on the stock exchange. Clearing Corporation of India handles this for Indian exchanges like NSE and BSE. |
| Clearing Member | A clearing member is a member of the clearing corporation who settles the trades which have taken place in the secondary markets. Clearing members are generally banks, mutual fund houses, and brokers. |
| Close Price | It refers to the final price at which a particular security was traded on an exchange during a specific timeframe |
| Commodity | Commodities are raw materials consumed directly or used to produce other goods. They include agricultural products and metals such as gold, silver, and copper. Investors and traders often use commodities to diversify their portfolios and hedge against inflation or other economic risks. |
| Competitive Advantage | A unique quality or resource that gives a company an edge over its competitors. |
| Competitive Analysis | Evaluating a company’s competitors, their market share, strengths, and weaknesses to assess market positioning. |
| Compounding | Compounding is when the amount you invest and the profit it makes, is used to make more profits. It is the process through which you would earn amplified returns because you reinvested your gains. |
| Consolidation | It refers to a period when a security’s price moves within a relatively narrow range, usually marked by repeated tests of the same support and resistance levels. |
| Consumer Price Index (CPI) | Consumer price index tracks the change in the prices of basket of goods and services over a period of time. It helps in understanding the rate of inflation seen in the economy. |
| Contingent Liability | Contingent liabilities are potential liabilities or losses which may fall upon a company in future due to uncertainty related to its business. These can be in the form of lawsuits, pending investigations, fines, warranties, etc |
| Contrarian Investing | It is an investment strategy where an investor goes against the general market sentiment about a certain stock or sector. Hence, you sell when others are buying and buy when others are selling. |
| Convergence | Convergence occurs when two or more indicators or price trends move closer to each other over time. Convergence often indicates a potential continuation of the current trend or a period of reduced volatility. |
| Convertible Bond | Convertible bonds are bonds that gives the owner of such bonds a right to acquire a predetermined number of equity shares of a company on exercising the conversion option. Under normal circumstances, it will perform as a common bond and provide yield in the form of interest payments. |
| Cut Off Price | The cut-off price is the offer price at which the shares get issued to the investors in an IPO. Investment Bankers compute this number based on the bids received by them during the IPO process. |
| Cyclical Stock | A cyclical stock is a type of stock that tends to go up and down based on changes in the economy in a predictable fashion. For example, consumer discretionary stocks usually do well when the economy is doing well and people have more money to spend, but they may struggle when the economy is not doing so well. |
| Debenture | These are instruments used by large corporates to raise funds at a fixed interest rates but without any collateral to back. Investors generally invest in them based on the goodwill and earnings of corporates which offer them. They provide higher yields than collateral backed bonds. |
| Debt-To-Equity | Debt-to-equity (D/E) ratio is the ratio of a company’s total debt and financial liabilities to the value of its shareholder’s equity. The debt-to-equity ratio is a measure of how levered a company is or rather how much of a company’s assets are financed through debt. Usually, low debt-to-equity ratios are more desirable, but one should also keep in mind the sector of the company to get a proper idea of how levered the company is. |
| Decline | The number of securities from a sector or index that have decreased in price during a specific period of time. |
| Deep-In-The-Money | Deep in the money is any option contract that has nearly all its value in intrinsic terms (difference between strike price and current price) and minimal extrinsic or time value. For eg: If Nifty is trading at 18500 and I have a call option of strike price 17500 priced at ₹1050, then the extrinsic value is only ₹50 and intrinsic value is ₹1000 which is the difference between strike price and market price. |
| Defensive Stock | A defensive stock is any stock that is least affected by the change in economic conditions. These stocks are also called non-cyclical stocks since they don’t follow economic cycles. The main reason for this behavior is that the consumption of goods or services these stocks provide doesn’t depend on market cycles. Eg: defense stocks, pharma stocks, etc. |
| Deflation | Deflation is when the prices of goods and services generally decrease over time. This can occur due to a decrease in the money supply or a decrease in consumer demand. |
| Delisted Stock | Delisted stocks refer to the stocks that are taken off from the exchanges. Delisted stocks have to be traded outside exchanges and in the over-the-counter market. A stock may get delisted due to multiple reasons, including bankruptcy, inadequate market capitalisation, or failure to meet regulatory requirements. Companies may delist voluntarily due to non-performance, amalgamations, and mergers. When a stock is being delisted, the promoters must offer to buy back the shares through a reverse book-building process. |
| Delivery | Delivery is when ownership of shares transfers from one investor to another after a trade settles in a . This indicates a long-term interest in the share rather than trading. |
| Delta | Delta is the theoretical estimate of how much an option’s value may change given a ₹1 move up or down in the underlying security. The Delta values range from -1 to +1, with 0 representing an option where the premium barely moves relative to price changes in the underlying stock. |
| Demat account | A or dematerialised account electronically holds the shares traded by investors. |
| Depository | A depository is a company that electronically stores securities for investors. It holds shares, bonds, mutual fund units, government securities, and more. In India, we have two depositories: CDSL and NSDL. |
| Depository Participant (DP) | Depository participants are mediators between depositories and investors. They are also referred to as agents of depositories and generally stock brokers act as depository participants. |
| Depreciation | A reduction in the value of an asset over time due to regular wear and tear. For eg: the value of a car bought by you reduces as it gets older and older. |
| Descending Top | Descending tops is a pattern on a chart where each price peak is lower than the previous one, showing a bearish market trend. |
| Devaluation | The reduction or underestimation of the worth or importance of something from what it was valued at earlier. It is also used in the context of currencies and exchange rates. It refers to the intentional decrease in the value of a country’s currency relative to other currencies in the foreign exchange market. When a currency is devalued, it means that it now takes more units of that currency to buy one unit of another currency. |
| Discount Broker | A stock broker who offers a platform to trade securities to his clients at low costs is called a discount broker. |
| Divergence | Divergence occurs when two or more indicators or price trends move farther away from each other over time. It suggests a lack of agreement or alignment between the indicators, which can signal potential changes in the market direction. Divergence often indicates a potential reversal or weakening of the current trend. |
| Diversification | Diversification means not putting all your money into one thing. You spread it across different investments like stocks, bonds, or real estate to lower the risk. |
| Dividend Declaration Date | This is the day that the company announces its intent to issue dividends. Usually, this is when the company’s AGM/EGM takes place, and the company’s board approves the dividend issue. |
| Dividend Payout Date | This is the day that the dividends are paid to the shareholders listed in the company register. |
| Dividend Yield | The dividend yield of a stock is calculated by dividing the total dividends paid in a particular year by its current price expressed in percentage terms. It denotes how much money you could get back as dividends based on what you paid for the stock. |
| Domestic institutional investors (DIIs) | Institutional investors who invest in their home country are called as domestic institutional investors (DII). DIIs can include mutual fund houses, insurance companies, pension funds and banks. Institutional investors are often called market makers due to the high portion of trades carried out by them. They are essential for a market to be liquid. |
| Double Bottom | A double bottom is a technical chart pattern where the price of an asset drops to a certain level, then bounces back, and then falls again to the same level before bouncing back once more. It resembles two troughs at around the same price point. This pattern can suggest a possible reversal from a downtrend to an uptrend. |
| Double Top | A double top is a technical chart pattern where the price of an asset reaches a certain level, pulls back, and then makes another attempt to reach the same level again. It looks like two peaks at approximately the same price point. This pattern indicates a potential reversal from an uptrend to a downtrend. |
| Dow Jones Industrial Average (DJIA) | The Dow Jones Industrial Average, Dow Jones, or simply the Dow, is a stock market index of 30 prominent companies listed on stock exchanges in the United States. The DJIA is one of the oldest and most commonly followed equity indexes, |
| Downtrend | A downtrend refers to a consistent downward movement in the price of a stock or market over a period of time. It indicates a negative momentum and often signifies a bearish market sentiment. |
| Drawdown | Drawdown is the decline of a stock price from its peak during a specific period of investment. A drawdown is usually measured in percentage. For eg: If a stock was trading at ₹100 at its peak and trades at ₹80 today then it has shown a drawdown of 20%. |
| Dumping | Dumping is a situation where investors sell large values of their holdings in a stock. If a very heavy dumping of stock happens then the stock price may fall sharply reaching lower circuit levels. |
| Earnings Per Share (EPS) | Earnings per share (EPS) is the ratio of the net earnings of a company in a previous financial year to the number of outstanding shares. EPS is a measure of the profitability of a company. |
| EBITDA | Earnings before interest, taxes, depreciation and amortisation (EBITDA) is a measure of a company’s core profitability. Depreciation and amortisation are non-cash expenses, and the taxes and interest expenses depend on a company’s capital structure. By ignoring these expenses investors can learn about the cash profits earned by a company through their main business. |
| Economic Indicators | Data points that reflect the health and performance of an economy, such as unemployment rates or consumer spending. |
| Emerging Markets | Emerging markets are economies of countries that are in the process of rapid growth and development, but which have not yet reached the level of maturity and stability seen in developed countries. For example: India, Brazil, China, Mexico, Indonesia etc |
| Liquidity | ETF Liquidity refers to how easily you can buy or sell units of an Exchange-Traded Fund (ETF) without causing a big change in its price. If an ETF is highly liquid and there are many people trading it, you can quickly get in or out without affecting its price much. On the other hand, if an ETF is less liquid, there might not be as many buyers or sellers, and trading could impact its price more. |
| Ex-Dividend Date | It is the day when a company’s shares start trading without the right to receive the upcoming dividend payment. If you buy shares on or after the ex-dividend date, you won’t get the dividend payment. If you buy shares before this date, you willll be entitled to the dividend. |
| Exchange Traded Fund (ETF) | Exchange-traded funds (ETFs) are like a mix of mutual funds and stocks. You can buy and sell them on exchanges like stocks. They gather money from many investors and invest in different things, like mutual funds do. |
| Exit Load | Exit load refers to the fees charged by mutual funds when an investor sells their units (exit). It is only charged if investors pull out their money from mutual funds early, usually within a specific time after you put it in |
| Expense Ratio | The expense ratio of a mutual fund is the fee charged by the asset management company. It covers the costs of managing the fund, like administration, advertising, salaries, etc. An expense ratio of 1% per annum means that each year 1% of the fund’s total assets will be used to cover expenses. |
| Exponential Moving Average (EMA) | A technical indicator that calculates the average price of an asset over a specified period of time, giving greater weight to more recent prices in the calculation. The EMA is more responsive to changes in price trends than a simple moving average, and is commonly used to identify short-term trends in the market. |
| Extended Internal Rate of Return (XIRR) | XIRR, or Extended Internal Rate of Return, is a financial metric used to calculate the annualized rate of return for an investment that involves irregular cash flows. It takes into account both the timing and the amount of these cash flows, providing a more accurate representation of the investment’s performance over time. |
| Face Value | The face value of a security is a term used to describe the security’s nominal or original value at the time of issuing and is unaffected by market conditions. In the case of stocks, the face value is the original cost of the stock as listed on the certificate, while in the case of bonds, it is the amount paid to the holder at maturity. |
| Fair Value | An estimated price at which buyers and sellers would freely trade an asset is called its fair value. The various ways to determine the fair value of an asset include looking at recent market transactions for similar assets, estimating its expected earnings or the cost of replacing it. |
| Federal Open Market Committee (FOMC) | FOMC or the Federal Open Market Committee is a twelve member body of the US Federal Reserve which makes the important economic decision of managing key interest rates and money supply in US markets. Since US Dollar is a major currency used for trading between nations the decisions of FOMC is very important data point to track for investors. |
| Floating Interest Rate | A floating interest is the rate of interest of any debt instrument which changes periodically either positively or negatively due to changes in the underlying economic condition or market cycle. |
| Follow-on Public Offer (FPO) | Follow-on public offers (FPOs) are issuances of new shares by a company already listed on stock exchanges. Public offers are ways for companies to raise money that can be used for various purposes like expansion activities or paying off existing debt. This is different from an IPO where a company invites public to invest in them for the first time. |
| Forecasting | Making predictions about a company’s future financial performance based on historical data and market trends. |
| Foreign Institutional Investors (FII) | Institutional investors established or incorporated outside India seeking to invest in securities in India are called Foreign Institutional Investors (FII). For developing countries, FIIs can be an important source of capital. However, various countries place limits on the FIIs to limit their influence on a country’s capital markets and the damage they might cause if they flee during a crisis. |
| Free Float | Free float refers to the percentage of a company’s shares that are available for trading in the stock market. It excludes shares held by company insiders or major investors that are not actively traded. It gives an idea of how many shares are accessible for buying and selling by the general public, which can impact stock prices. |
| Front-Running | Front running is an illegal activity when someone uses insider information about upcoming trades to buy or sell stocks before others. The front runner invests before everyone else and gets out of the trade once the peak price has been achieved. |
| Full-Service Broker | If a broker provides other services besides the facility to trade securities, like market research, retirement planning, portfolio management, etc then they are called as full-service broker. |
| Fund Of Funds (FoF) | Funds of funds (FoFs) are mutual funds that invest in other mutual funds or ETFs to provide high level of diversification in assets. |
| Fundamental Analysis | Fundamental analysis is a technique of studying a stock on information about its business or the sector in which it operates. Usually, fundamental analysts use financial statements, the state of the economy, interest rates etc. to figure out if the stock price is fair or not. |
| Gamma | Gamma is the rate of change for an option’s delta based on a one point move in the underlying security’s price. It is a second-order factor, sometimes known as the delta of the delta. Gamma is at its highest when an option is at the money and is at its lowest when it is further away from the money. |
| Gap up or Gap down | Gap up or gap down refers to a situation where the price of a stock or market opens significantly higher (gap up) or lower (gap down) than its previous closing price. This gap is often caused by news or events that occur outside of regular trading hours and can indicate strong buying or selling pressure. |
| Gold ETF | Gold ETFs are ETFs which invest in gold as an underlying asset either through gold bonds or bullion (physical gold). |
| Gold Funds | Gold funds are investment funds that invest in gold and gold-related assets. Gold funds include gold ETFs and gold mutual funds. For example, gold ETFs invest in 99.5% purity gold, while gold mutual funds invest in gold ETFs. |
| Government Securities (G-Secs) | Government securities (G-Secs) are debt instruments issued by the government through which it raises funds from capital markets. Long-term G-secs offer periodic interest payments, while short-term g-secs are issued at a discount and redeemed at par. |
| Grandfathering Clause | When a new clause or policy is added to a law, certain persons may be relieved from complying with the new clause. This is called “grandfathering”. “Grandfathered” persons enjoy the right to avail concession because they have made their decisions under the old law. |
| Gross Domestic Product (GDP) | The total value of all goods and services produced within a country’s borders, used to gauge economic activity. |
| Growth Plan | A growth plan in a mutual fund is a type of scheme which reinvests profits and dividends made back into the scheme. This plan is suitable for those looking for capital appreciation over the long term. |
| Hedging | Hedging is a strategy that tries to limit risks in financial assets. Put another way, investors hedge one investment by making a trade in another. Futures and options are generally used as instruments for hedging. |
| Heikin Ashi charts | They are similar to traditional candlestick charts, but instead of using the open, high, low, and close prices for each period, Heikin Ashi charts use a modified formula to calculate the prices. The formula takes into account the previous period’s prices and uses an average of the open and close prices as well as the high and low prices. This creates a smoother representation of price action and helps to filter out noise in the data. |
| High Price | It refers to the highest price at which a particular security was traded on an exchange during a specific timeframe. |
| Holding Company | A holding company is a type of financial organization that owns a controlling interest in other companies, which are called subsidiaries. The parent corporation can control the subsidiary’s policies and oversee management decisions but doesn’t run day-to-day operations . |