A Glossary of investment terms, such as insurance brokers, stock market, stock exchange, investing, home loans and price stocks

The following investment terms will help give your investment club a basic introduction into the language of investing.

The more that you understand about the world of investing the more you'll enjoy your investment club.

Home loans

A "home loan" is a credit to a consumer for the purchase or transformation of the private immovable property he owns or aims to acquire, secured either by a mortgage on immovable property or by a surety commonly used in a Member State for that purpose.

insurance brokers

An agent on behalf of the insured who negotiates the terms and cover provided by the insurer in the insurance policy.

All or none (AON)

A stipulation to either a buy or a sell order which instructs the broker to either fill the order in its entirety of to fill none at all, the customer won't accept a partial execution (only 300 shares out of an order for 1000).

Stock market

Where stocks and shares are bought and sold.

A stock exchange

is an organization of which the members are stock brokers. A stock exchange provides facilities for the trading of securities and other financial instruments

Johannesburg Stock Exchange

The JSE Securities Exchange, previously known as the Johannesburg Stock Exchange, is South Africa's only stock exchange. It is located in Johannesburg, and ranks as Africa's biggest stock exchange.

Appreciation

The increase in the value of an asset.

Asked price

The lowest price that anyone has declared that he will sell his security for at a given time. In over-the-counter stocks, the "ask" is the best quoted price at which a Market Maker is willing to sell a stock.

At the money

An option where the strike (exercise) price is exactly equal to the trading price of the underlying security.

Bid price

The highest price anyone has declared that he wants to pay for a security at a given time.

Broker

An individual or a firm that charges a fee or commission for executing buy and sell orders submitted by another individual or firm. (2) The role of a brokerage firm when it acts as an agent for a customer and charges the customer for its services.

Call option

An option contract that gives the holder the right to purchase, and places upon the obligation to sell, a specified number of shares of the underlying stock at the given strike price on or before the expiration date of the contract.

Capital

Accumulated money or goods used to produce income

Commercial paper

Short-term loans with maturities ranging from 2 to 270 days that are made to banks and corporations.

Commodity

Bulk goods such as metals, foodstuffs and grains which have the price determined by competitive bids and offers.

Common stock

An equity security that represents ownership in a corporation.

Cusip number

A unique 9-digit number code for a given class of security (i.e.: Microsoft common stock or Acorn International Fund). CUSIP stands for the Committee on Uniformed Security Identification Procedures.

Day order

An order to buy or sell which, if not executed, expires at the end of the trading day it was entered.

Dealer

The role of a securities firm when it acts as a principal in a particular trade. A firm is acting as a dealer when it buys or sells a security for its own account and at its own risk and then charges the customer a markup or markdown.

Do not reduce

Stipulation to order that instructs the broker not to decrease the limit price on buy-limit and sell-stop orders on the record date of a cash dividend.

Exchange

Any organization, association or group of persons that maintains or provides a marketplace in which securities can be bought and sold. An exchange does not have to have a physical place of business and several electronic exchanges do business.

NASDAQ National Market Securities

The NASDAQ National Market consists of over 3,000 companies that have a national or international shareholder base, have applied for listing, meet stringent financial requirements and agree to specific corporate governance standards. To list initially, companies are required to have significant net tangible assets or operating income, a minimum public float of 500,000 shares, at least 400 shareholders, and a bid price of at least $5.

Penny stocks

Low prices stocks trading in the over-the-counter market. Typically refers to shares trading below one dollar a share.

Trading authorisation

Document granting power-of-attorney rights to an agent of the account holder's. You will find downloadable forms for both Limited Trading Authorization and Full Trading Authorization in the Industry Forms Download area.

Investing and investment clubs

Starting your own investment club for fun and profit is easy when you follow the advice and guidelines as outlined in this website.

It doesn't matter whether you're an amateur investor just starting out, or a more experienced investor that wants to expand into more investments, there are people out there who share your interests and goals.

When you're part of an investment group you'll have the benefit of learning more about investing in the stock market combined with the enjoyment of spending time with people who have a common goal:

• To become more knowledgeable about investing and have fun doing it.

There are many books that you can purchase, and places on the Internet, that outline the information and data that you need to invest successfully and profitably.

Investing doesn't have to be an intimidating experience but should be something that you have fun doing.

The following are Stock market Symbols used in investment business

After you use the steps and information in this website about starting an investment club you'll be on your way to investing in the stock market.