Stock market terminology - Basic knowledge of stocks

Bull market:

There are more buyers than sellers in thestock market, so the stock market is bullish.

Bearmarket:

A bear market is the opposite of a bullmarket. There are more sellers than buyers in the stock market.

Openingprice:

It refers to the price of the firsttransaction of the stock after the opening of the market on that day. If thereis no transaction price within 30 minutes after the market opens, the closingprice of the previous day shall be the opening price.

ClosingPrice:

Refers to the price of the last stock tradeddaily, i.e., the closing price.

HighestPrice:

It is the highest of the prices traded on thatday. Sometimes the highest price is only one, sometimes it is more than one.

LowestPrice:

It is the lowest of the prices traded on thatday. Sometimes the lowest price is only one, sometimes it is more than one.

PerformanceStocks:

It is the stocks of companies that have anexcellent track record but are growing at a slower pace. 

These types of companies are strong enough towithstand a recession, but these types of companies do not provide you withencouraging profits. Since these companies are more mature and do not need tospend a lot of money to expand their business, the main purpose of investing inthem is to collect dividends.

Also, don't invest in these stocks witha high P/E ratio, and pay attention to the history of stock price volatilityduring economic downturns.

Popularstocks:

Refers to stocks with large trading volume,strong liquidity, and high stock prices.

Growthstocks:

It refers to the stocks issued by suchcompanies continuing to grow in sales and profits faster than the country andindustry as a whole. 

These companies are usually ambitious, focuson scientific research, and set aside large amounts of profits for reinvestmentto fuel their expansion.

A roundlot:

It is an internationally used unit forcalculating the number of shares traded. In stocks, a round lot is considered100 shares or a larger number that can be evenly divided by 100.

Volume:

The number of shares traded reflects thevolume of transactions. This is generally measured by the number of sharestraded and the amount traded. Both indicators are currently available for theShenzhen and Shanghai markets.

Price:

It refers to the unit of increase or decreaseof the call price. The price level varies according to the price per share ofthe stock. 

Take the Shanghai Stock Exchange as anexample: $0.10 for every last $100, $0.20 for every $100-200, $0.30 for every$200-300, $0.50 for every $300-400, and $1.00 for every $400 and above.

Suspension:

The stock exchange suspends its trading in thestock market due to the continuous rise or fall of stock prices due to certainnews or certain activities. After the situation is clarified or the companyreturns to normal, the trading will be resumed and listed on the exchange.

Change:

The daily closing price is compared with theprevious day's closing price to determine whether the stock price rises orfalls. It is generally indicated by the "+"-" sign on thebulletin board above the trading desk.

LimitMove:

The most significant increase (decrease) inthe stock price in one day as specified by the Exchange is the percentage ofthe previous day's closing price, which cannot be exceeded, or trading will beautomatically halted.

Openhigh:

It means that the opening price is much higherthan the closing price of the previous day.

Openlow:

It means that the opening price is much lowerthan the closing price of the previous day.

Be dull:

It means that investors do not actively buyand sell, and take a wait-and-see attitude so that the stock price changes varylittle on the day. 

Consolidation:

It means that after a period of sharp rise orfall, the stock price begins to fluctuate slightly and enter a stage of stablechanges. This phenomenon is called consolidation, which is the stage ofpreparation for the next major change.

Gaps:

Refers to the strong bullish or bad newsstimulus, the stock price began to fluctuate sharply. A gap usually occursbefore the start or end of a major stock price movement.

Price-earningsratio (or P/E ratio):

The price-to-earnings ratio is the ratio ofthe stock price per share to the earnings per share. 

Price-to-earnings ratio = common stock marketprice per share ÷ common stock annual earnings per share

The numerator in the above formula is thecurrent stock market price, and the denominator can be the last year's earningsor the forecast earnings for the next year or several years. 

The price-earnings ratio is one of the mostbasic and important indicators for estimating the value of common stocks. It isgenerally believed that it is normal for the ratio to remain between 20-30. Avery small ratio indicates that the stock price is low with low risks, and itis worth buying; too large indicates that the stock price is high with high risks,so you should be cautious when buying. But stocks with high P/E ratios aremostly hot stocks, and stocks with low P/E ratios may be unpopular stocks.

Call-back:

A phenomenon in which the price of a stockfalls back temporarily as it rises too fast.

Rebound:

It refers to the phenomenon that in a fallingprice quotation, the share price sometimes rallies temporarily under thesupport of buyers because it has fallen too fast. The rebound is smaller thanthe decline, and the downward trend resumes after the rebound.

Long:

A person who is optimistic about the stock'sfuture market buys the stock first, waits for the stock to rise to a certainprice, and sells the stock for the difference.

Shortsellers:

An investor who believes that the stock hasrisen to its peak and will soon fall, or when the stock has already started tofall, thinks it will continue to fall and sells at the high price.

LongMarket:

Also known as a bull market, a market in whichstock prices generally rise.

ShortMarkets:

A market in which stock prices are on along-term downward trend, and in a short market, stock prices move in small andlarge declines. Also known as a bear market.

LongFlip:

A long position that was originally bullish onthe price, but changed its mind and sold its shares, sometimes with borrowedshares, in an action known as a short flip or long flip.

Short-flip-long:

The act of buying back, and sometimes buyingmore shares, of a stock that has been sold, which is called shorting.

ShortBuying:

A form of speculation in which a stock isexpected to rise in price and is therefore bought, and then sold, before actualdelivery, to collect the difference or make up the difference in actualdelivery.

Shortselling:

A speculative act of selling stock inanticipation that the stock price will fall, thus making up the sale of thestock as if it were sold before actual settlement occurs, and settling only thedifference at the time of settlement.

Bearnews:

Factors and news that contributed to thestock's decline in favor of the shorts.

Bullnews:

It's the factors and news that spurred thestock to rise in favor of the bulls.

Hold up:

It means that the stock price is expected torise and the stock price will fall after buying, or the stock price is expectedto fall, but the stock price will rise after the stock is sold. 

The former is called the bulls and the latteris the bears.

Largeinvestors:

These are large investors, such as consortia,trusts, and other groups or individuals with large amounts of capital.

Middleinvestors:

This refers to investors who have a largeamount of investment.

Retailinvestors:

It is the individual investor who trades avery small number of shares.

Broker:

A person who executes a client's order to buyor sell securities, commodities, or other property, and receives a commissionfor doing so.

ShortSnapping:

Buying at a low price in anticipation of arising share price and then selling at a high price shortly. Or expect theshare price to fall, sell at a high price first, and then wait for theopportunity to repurchase at a low price in the short term.

Consolidation:

After a period of rapid upward or downwardmovement, the price of a stock encounters resistance or support and movesslightly up or down, making a change of hand.

Pull-up:

A pullback is an unusual way to raise theprice of stock significantly. Usually, large investors will sell out after apullback to make a huge profit.

Squeeze:

It is an unusual way to depress the price of astock. Usually, large investors buy in large quantities after the suppressionto make huge profits.

DarkHorse:

A stock that has doubled or multiplied inprice within a certain period.

WhiteHorse:

It means that the stock price has formed along, slowly rising channel, with some room to rise.

Deceptionline:

Large investors take advantage of stockinvestors' superstitious belief in technical analysis data and charts todeliberately lift and suppress stock indices, resulting in the formation of acertain line in the technical charts to lure stock investors to buy or sell inlarge quantities, thereby achieving their goal of making a fortune. This typeof deceptive technical chart line is called a cheatline.

TechnicalAnalysis:

An analytical study of markets and stocksbased on supply and demand. Technical analysis studies price movements, tradingvolumes, trading trends and patterns, and charts representations of thesefactors to predict how current market behavior may affect future supply anddemand for securities and individual holdings of securities.

FundamentalAnalysis:

An analysis of a business based on sales,assets, earnings, products or services, markets, and management. Also refers tothe analysis of macro-political, economic, and military dynamics to predicttheir impact on the stock market.

Unlistedstocks:

Shares that are not registered and listed onthe stock exchange.

Proxy:

Written evidence of the shareholder'sappointment of another person (other shareholders) to exercise voting rights onhis or her behalf at a general meeting of shareholders.

Turnover:

The number of shares traded as a percentage ofthe number of shares listed and outstanding on the Exchange.

Warrants:

A certificate issued to the originalshareholders of a company to purchase a certain number of shares at adiscounted price when the issuing company issues new shares. Warrants areusually time-limited and expire after a certain period. They expire and can besold or transferred by the holder during their term.

Exemptions:

The closing price of a stock on the day beforethe stock is ex-dividend minus the difference between the rights included inthe ex-dividend.

Payout:

The closing price of a stock on the previousday minus the dividend paid by the listed company is called a payout.

Cumrights:

Any stock with rights that have not beendelivered is referred to as an inclusion right.

FillingRights:

An increase in the share price after theex-rights, which makes up the difference between the ex-rights and the shareprice, is called a fill-in.

Shareincrement:

Listed companies often undertake capitalincreases (covered allotments) or capital reserve additions (uncoveredallotments) for business needs.

RightsIssue:

When the Company issues additional new shares,they are allocated to shareholders for subscription at a special price (belowmarket price) based on the number of shares owned by the shareholders.

Sit ina sedan chair (Front running):

When the stock price is expected to rise, buyat a low price and sell for a profit when many retail investors follow, and thestock price rises.

Carryin a sedan chair:

The result is that the price of the stock isinflated so that others can profit from it, while the price of the stock is notlow enough to make a profit.

Get offthe sedan chair:

Investors make rallies and settle for the nexttransaction.

Resistancelines:

When the price of a stock rises near a certainlevel, if there is a large amount of selling, the stock stops rising or evengoes back down.

Supportline:

The price at which a stock drops to near acertain level, such as the level at which it stops falling or even rises ifthere is a lot of buying.

Gap:

When the stock market is stimulated by strongpositive or negative news, the stock price starts to jump sharply, when it goesup, the opening or lowest price of the day is higher than the closing price ofthe previous day by more than two reporting units, it is called "gapup"; when it goes down, the day's day market or the highest price is lowerthan the previous day's closing price by two reporting units, and in one day'strading, it goes up or down by more than one reporting unit, it is called"gap down".

Fill inthe gap:

It means that a short position that was nottraded when the gap occurred will be filled, i.e. the stock will return to thepre-gap price over some time to fill the gap.

Retreat:

A phenomenon in an uptrend where the stockprice rises too fast and falls back to adjust the price.

Highprice:

The highest price at which an individual stockmoves from a long market to a short market.

Breakout:

A price movement in stock after a period oftrading.

Bottom-finding:

The stock stops falling and rallies when itcontinues to fall to a certain price level, and so on one or more times.

Head:

When the stock rises to a certain price level,it meets resistance and slips.

Pegging:

Buy the stock.

Peggingout:

Sell the stock.

Near-termTrend:

The near-term trend refers to 20 to 30 days inthe past from now.

FullDelivery:

It is a method of trading in the settlementpower specifically created by the securities authorities for shares of areorganized company or a public company that is in significant trouble.

OrderWashing:

To achieve the purpose of speculation, it isnecessary to allow low-priced and weak-willed sedan passengers to get off thesedan on the way to reduce the pressure on the upshift and at the same timeincrease the average price of stockholders.

Knock-to-knocktransfer:

A knock-to-knock transfer is a transfertransaction in which a broker buys a stock at a low price, receives acommission from the customer, and then sells it to another customer at a higherprice, from which he makes another profit on the difference.