Stock exchangeOrganization that provides services for stock brokers and traders to trade securities The New York Stock Exchange in Lower Manhattan, New York City is the world's largest stock exchange per total market capitalization of its listed companies. A stock exchange, securities exchange, or bourse is an exchange where stockbrokers and traders can buy and sell securities, such as shares of stock, bonds and other financial instruments.
StockbrokerA stockbroker is an individual or company that buys and sells stocks and other investments for a financial market participant in return for a commission, markup, or fee. In most countries they are regulated as a broker or broker-dealer and may need to hold a relevant license and may be a member of a stock exchange. They generally act as a financial adviser and investment manager.
StockStocks (also capital stock, or sometimes interchangeably, shares) consist of all the shares by which ownership of a corporation or company is divided. A single share of the stock means fractional ownership of the corporation in proportion to the total number of shares.
Market makerA market maker or liquidity provider is a company or individual that quotes both a buy and a sell price in a tradable asset held in inventory, hoping to make a profit on the difference, which is called the bid–ask spread or turn. This stabilizes the market, reducing price variation (volatility) by setting a trading price range for the asset.
SpeculationIn finance, speculation is the purchase of an asset (a commodity, goods, or real estate) with the hope that that asset will become more valuable in a brief amount of time. The term can also refer to short sales, in which the speculator hopes to profit from a decline in the asset's value. Speculation often has a pejorative connotation, as the activity is linked to bubbles, economic downturns, and financial crises.InvestorPerson who allocates capital with the expectation of a financial return An investor is a person or entity that allocates financial capital with the expectation of a future return (profit) or to gain an advantage (interest). Through this allocated capital the investor usually purchases some species of property.
Public companyCompany that offers its securities for sale to the general public The New York Stock Exchange Building in 2015 A public company is a company whose ownership is organized via shares of stock which are intended to be freely traded on a stock exchange or in over-the-counter markets. A public (publicly traded) company can be listed on a stock exchange (listed company), which facilitates the trade of shares, or not (unlisted public company).
Over-the-counter (finance)Over-the-counter (OTC) or off-exchange trading or pink sheet trading is done directly between two parties, without the supervision of an exchange. It is contrasted with exchange trading, which occurs via exchanges. A stock exchange has the benefit of facilitating liquidity, providing transparency, and maintaining the current market price. In an OTC trade, the price is not necessarily publicly disclosed.
Equity crowdfundingEquity crowdfunding is the online offering of private company securities to a group of people for investment and therefore it is a part of the capital markets. Because equitycrowdfunding involves investment into a commercial enterprise, it is often subject to securities and financial regulation. Equity crowdfunding is also referred to as crowdinvesting, investment crowdfunding, or crowd equity.
Volatility (finance)In finance, volatility (usually denoted by "σ") is the degree of variation of a trading price series over time, usually measured by the standard deviation of logarithmic returns. Historic volatility measures a time series of past market prices. Implied volatility looks forward in time, being derived from the market price of a market-traded derivative (in particular, an option).Hedge (finance)Investment position used to offset potential losses in another asset A hedge is an investment position intended to offset potential losses or gains that may be incurred by a companion investment. A hedge can be constructed from many types of financial instruments, including stocks, exchange-traded funds, insurance, forward contracts, swaps, options, gambles, many types of over-the-counter and derivative products, and futures contracts.
Commission (remuneration)A commission is a form of variable-pay remuneration for services rendered or products sold. Commissions are a common way to motivate and reward salespeople. Commissions can also be designed to encourage specific sales behaviors. For example, commissions may be reduced when granting large discounts. Or commissions may be increased when selling certain products the organization wants to promote.ArbitrageArbitrage (, UK also) is the practice of taking advantage of a difference in prices in two or more markets – striking a combination of matching deals to capitalize on the difference, the profit being the difference between the market prices at which the unit is traded. Arbitrage has the effect of causing prices of the same or very similar assets in different markets to converge.*As an Amazon Associate I earn from qualifying purchases.