An entity that abides by specific legal requirements that sets it apart as having a legal existence, as an entity separate and distinct from its stockholders (owners).
A plan offered by a corporation that allows investors to reinvest their cash dividends by purchasing additional shares or fractional shares on the dividend payment date.
Definition: An investment service that allows individuals to purchase a stock directly from a company or through a transfer agent. Not all companies offer DSPPs and the plans often have restrictions on when an individual can purchase shares. Example: The greatest benefit of using direct stock purchase plans for investors is the ability to avoid commissions by not Read More…
A phrase used for a stock where the price has dropped significantly in a short period of time. A falling knife security can rebound, or it can lose all of its value where the shares become worthless.
The total market value of all final goods and services produced in a country in a given year, equal to total consumer, investment and government spending, plus the value of exports, minus the value of imports.
An order to buy or sell a stock at a fixed price. This order is active until 1) the trade is executed, 2) the investor decides to cancel it or 3) a specified time period elapses.
Analysis of ADX is a method of evaluating trend and can help traders to choose the strongest trends and also how to let profits run when the trend is strong.
If you perform four or more day trades in a 5 day period you may get flagged by the SEC as a “Pattern Day Trader.” This can cause you to lose your margin account status until you deposit enough cash to have $25,000 or more in your account. Many beginning traders have been bitten by this rule!
An event pattern called a bad earnings surprise is where a company distributes an earnings announcement then the market defines it as worse than expected. Even in a bear market about 61% will have upward breakouts.
A trading term called a dead cat bounce is used to when a stock is in a severe decline and has a sharp bounce off the lows. It occurs due to the huge amount of short interest in the market. Once the supply and demand has become unbalanced, any type of bear market rally will create a massive short covering which will lead to a swift price move up. This bounce will be short lived and followed up by heavy selling which will break the prior price low.
Charting Software is an analytical, computer-based tool used to help equity (stock) traders with trading analysis by charting the price stock price for various time periods along with various indicators. Equity charting software packages are used by many traders to determine the direction on any given stock price.
Had the American Indians sold their beads and trinkets they received from selling Manhattan Island, invested their $16 and received 8% compounded annual interest, not only would they have enough money to buy back all of Manhattan, they would still have several hundred million dollars left over. That is the power of compound interest over time.
Definition: The amount of sales generated for every dollar’s worth of assets. It is calculated by dividing sales in dollars by assets in dollars. Formula: Also known as the Asset to Turnover Ratio. More Detail: Asset turnover measures a firm’s efficiency at using its assets in generating sales or revenue – the higher the number Read More…
The American Stock Exchange (AMEX) is the third largest Stock Exchange in the US by trading volume. It overlooks the trading of approximately 10% of all US traded securities including small-cap stocks, ETF’s and Derivatives.
