Virtual Stock Market

Glossary of Stock Exchange

Balanced Investment Strategy - Portfolio management strategy where assets are allocated with the aim of avoiding excessive risk by diversifying the investment across different asset classes, including ones whose performance is not correlated.

BOLT - BSE-On-Line-Trading

Bull - A bull is a operator expecting a rise in price so that he can later sell at a higher price.

Bull Market - A rising market with abundance of buyers and few sellers.

Bear - An individual who expects price to go down.

Bear Markets - A weak or falling market characterised by absence of buyers.

Bargain - Transaction between two members of the exchange. The terms "dealings" and "contracts" also have identical meanings.

Bid - A bid is the demand for a security that can be entered by the syndicate/sub-syndicate members in the system. The two main components of a bid are the price and the quantity.

Bidder - The person who has placed a bid in the Book Building process.

Book Closure - Dates between which a company keeps its register of members closed for updating prior to payment of dividends or issue of new shares or debentures.

Bonds - Long term debt instruments.

Cash Settlement - Payment for transactions on the due date as distinct from carry forward (Badla) from one settlement period to the next.

Crisis - Reckless heavy short-sales leading to unduly depressed prices. In such a situation, the Governing Board may prohibit short sales, fix minimum prices below which sells or purchases are not permitted and limit further dealings only to closing out of existing contracts.

Daily Change - The daily change in the price of a share or other security, i.e. the difference between the most recent price of a security and the previous day's closing price.

Daily Close - The settled price at which a traded instrument is last traded at on a particular trading day. Also known as closing price.

Daily High - The highest price traded by a security or currency during a given day. It can also refer to the highest point reached by an index.

Daily Low - The lowest price traded by a security or currency during a given day. It can also refer to the lowest point reached by an index.

Debenture - A long term investment that is not usually secured by a mortgage on a specific property.

De Minimis Limit - In general, meaning lacking significance or importance, in other words the amount is so small that it does not matter and is not taken into account.

Equity capital - Long term funds provided by the owners of a firm and consists of ordinary share capital and retained earnings.

Floor Price - The minimum offer price below which bids cannot be entered. The Issuer Company in consultation with the Book Running Lead Manager fixes the floor price.

GAAP - Generally Accepted Accounting Principles.

ICMA - GInternational Capital Market Association.

Listed Company - A public limited company which satisfies certain listings conditions and signs a listing agreement wit the stock exchange for trading in it securities. One important listing condition is that 25% of its issued capital should be offered to the public.

Preference Shares - Shares in a company which give their holders an entitlement to a fixed dividend but which do not usually carry voting rights.

Pro Forma Invoice - An invoice presented by one company to another for payment for goods prior to their dispatch.

Rights Issues - The issues of new shares to existing shareholders in a fixed ratio to those already held at a price which is generally below the market price of the old shares.

Specified Shares - For the purpose of trading, a security is categorised either as a 'specified' shares or a 'non-specified' security. This is done by stock exchange authorities.

Stamp Duty - The ad valorem duty of 1/2 per cent payable by buyers for transfer of shares in their name.