Following are the significant terms more commonly used in stock exchange −

 

Bull − Bulls are those brokers who strongly expect price hike of securities and with this hope, they buy shares to sell them at later stage (when price gets increased). Thus bull market means when buying of the securities are on much higher side instead of selling of the securities. Bulls first buy securities and sell when the price of securities is high.

 

Bear − Bear is pessimist, who expect fall in the price of certain securities. A Bear first sells his securities and purchases at later stage when the price of securities are low and the difference of both is his profit.

 

Stag − A cautious investor or speculator is known as a stag. Stag doesn’t sell or buy shares in his hand, but he tries to buy shares of new company with a hope that price of those shares will increase in the future.

 

Blue Chips − Shares of well-recognized, well-renowned, financially strong, and well-established companies.

 

Cash Shares − Settlement of some of the transactions are completed in cash are known as cash shares. These transactions are done by real and genuine investors who want to buy or sell shares for the actual investment purpose.

Cleared Shares − Speculators are normally deals in such type of shares. In these types of shares, settlement of the payments are done by the differential amounts only; however, actual delivery of the securities may not be done.

 

Carry Over or Badla System − Speculator earns money by foreseeing the future. If their expectations come true, they earn profit and if not, they lose money. Speculator mostly does transactions on forward basis, when any speculator forwards his transactions from one settlement date to another, he has to pay charges called “Badla charge.” Transaction of these natures is called as Badla System.

 

Kerb Market − Transactions that done before and after the official hours are known as kerb market.

 

Short Selling − Short selling means where the large volumes of securities are sold by the bear speculator without actually possessing.

 

Arbitrage − Securities are traded at the different stock exchanges and there is normally a little difference in prices (among different stock exchanges). Therefore, arbitrage is practiced to take advantage of different rates.

 

Primary Market − Primary market is the market where new securities are issued for the capital formation in the form of a new issue or in the form of a right issue to the existing shareholders.

 

Secondary Market − Secondary market is the market where subsequent trading (sale and purchase) of securities are done called as secondary market and the transactions are known as secondary transactions.

 

Group A Shares − Actively traded shares of the reputed companies are called a Group A shares.

 

Group B Shares − Not actively traded shares or the shares of different stock exchanges are called as Group B shares.