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| Commission | A fee charged by a broker or dealer for services performed in buying or selling stock on behalf of a customer. At MainXchange, the standard transaction fee is 95 cents. |
| Corporation | A business created as a distinct legal entity and composed of one or more individuals or entities. |
| Debit | A debt or negative balance. |
| Diversification | The spreading of investments across a number of assets in order to eliminate some, but not all, of the risk. |
| Dividend | The distribution of a portion of net earnings paid by a corporation to its shareholders, usually quarterly. |
| Dow Jones Averages | The averages of industrials, transportation and utilities that are published daily. The most commonly referred to averages on Wall Street. It is used to determine how the overall market is doing. |
| Bear Market | A period of time - usually two consecutive months or more - in which prices on the stock market are falling and in which falling prices result in at least a 20% decrease in the market value of share prices. |
| Blue Chip | A reference to a certain type of company or its stock. It is a company that is nationally known, highly esteemed and noted for the quality and wide acceptance of its products and services as well as for its consistent record of making profits and paying dividends. The term comes from poker, where a blue chip is the most valuable. |
| Broker | It is a person who is licensed to act as an agent, executing buy and sell orders, for any individual or group that wishes to invest in the stock market. |
| Bull Market | A period of time in which prices on the stock market are rising. |
| Buy Order | A transaction that is initiated by an investor in order to buy stock. |
| CEO | Chief Executive Officer. The top official of a corporation. |
| Close Price | The final, or last traded, price of a stock at the close of the trading day. |
| Holdings | All the stocks an investor currently owns. |
| Initial Public Offering (IPO) | A term used to describe the first time a company issues stock to the public - to be traded on a stock exchange. |
| Market Trend | An upward or downward movement of the market that lasts for an extended period of time. |
| NASDAQ | National Association of Security Dealers Automated Quotations. It trades thousands of companies through a national computerized network of dealers. It lists 4,700 companies, including Microsoft, Apple and Intel. |
| NYSE | The New York Stock Exchange. Founded in 1790 in Philadelphia; it moved to New York in 1817. Today, it is one of the world's largest stock exchanges, where only the largest companies are traded. |
| P/E (Price/Earnings) Ratio | The price of a share divided by the earnings per share for a 12-month period. For example, the ratio of a stock selling for $60 a share and earning $6 a share would be 10 to 1. |
| Portfolio | A collection of investments (including stocks, bonds, T-bills, real estate, or any other type of investment) owned by an investor. |
| Profit Margin | Net income divided by revenue. It is always expressed as a percentage. |
| Recession | It is a period of time during which business activity temporarily slows. It usually lasts several months, but can sometimes last as long as one to two years. In a recession, factories run at less than their full capacity, the level of employment decreases and business profits fall. |
| Risk | The possibility or chance of gain or loss. |
| SEC | The Securities and Exchange Commission. Founded in 1934, it regulates the public stock exchanges in the US and monitors insider trading, which occurs when corporate officers buy or sell stock in their own company. |
| Shareholder | Any investor who buys stock in a corporation, becoming part-owner of the corporation. |
| Stock | Ownership shares of a corporation. Each stock represents one share of ownership of a particular corporation. |
| Stock Certificate | The actual piece of paper that indicates stock ownership. It usually contains a watermark and is patterned to make it hard to forge. |
| Stock Split | The division of a company's outstanding shares of stock into a larger number of shares, without any change in owner's equity. For example, a 2-for-1 split of 1 million outstanding shares would produce 2 million like shares of stock. Any investor owning 100 shares would now own 200 shares. |
| Ticker | An online display of the latest stock prices. |
| Trading Floor | The common name for a stock exchange's trading area. |
| Volume Traded | The number of shares traded on a given day; also called Market Volume. This figure can indicate the mood of investors: Declining stock prices in a market where volume traded is high can indicate a bearish, downward market trend. Consistently high volume trading in a rising market usually signals investor optimism and a bullish trend. |
| Yield | The annual rate of return on an investment, as paid in dividends or interest. It is calculated as a percentage of the amount invested. |
