Friday, February 3rd 2012 - 06:08:17 pm

TradeStocksAmerica.com Glossary of Terms

Glossary of Terms
(Some abbreviations are for communication on the Trading Room)

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IMHO – in my humble opinion.

Income stock - A stock with a history of paying consistently high dividends.

Index option - An option whose underlying security is an index. If exercised, settlement is made by cash payment, since physical delivery is not possible; see also stock or equity option.
Inflation is a rise in the general level of prices over time. It may also refer to a rise in the prices of a specific set of goods or services. In either case, it is measured as the percentage rate of change of the consumer or producer price index. Mainstream economists believe that high rates of inflation are caused by high rates of growth of the money supply. Also see Stagflation.
Initial Public Offering (IPO) - Initial Public Offerings (IPOs) are the first time a company sells its stock to the public. Sometimes IPOs are associated with huge first-day gains; other times, when the market is cold, they flop. It's often difficult for an individual investor to realize the huge gains, since in most cases only institutional investors have access to the stock at the offering price. By the time the general public can trade the stock, most of its first-day gains have already been made.

Insider Buying - Buying of a company's stocks by individual directors, executives or other employees. Generally a sign that those individuals believe that the company's stock is undervalued. May be illegal if insider information is the reason for the purchase. Opposite of insider selling.

Insider Selling - Selling of a company's stock by individual directors, executives or other employees (insiders). While selling of small amounts of stock is quite common and should not necessarily be a cause for alarm, selling of large amounts of stock is sometimes interpreted by investors as a sign that the insiders know something negative about the company's future. Insider selling which is based on insider information is illegal, even if an individual investor or trader who is not an officer or employee makes the transactions. Various rules and requirements are in place that allow insiders to sell specific amounts that at scheduled times that have been previously disclosed. Opposite of insider buying.

Intermediate Trades – loosely defined as a trade that can last from 1 week to 6 months.

Interest rates play a key role in the general economic and business cycle. When interest rates rise, consumers spend less, causing retail sales to slow, which leads to reduced corporate profits, leading to higher unemployment and usually declining stock market. Historically, an increase in interest rates is bearish for the stock market and a decrease in rates is bullish.

Intraday refers to “within a single trading day.”

Investor – an investor tends to look for investments to hold for periods of time typically over 1 year or longer. The opposite would be considered a trader.

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