Stock Market Terms by Topic

104 trading terms, grouped so you can learn related ideas together.

Last updated: October 17, 2026

Pick a topic below, or browse the full A–Z stock trading dictionary. Each term has its own page with a definition, a worked example and links to related terms.

Market basics

How stocks are quoted, traded and organized.

  • Quote – A stock quote is a snapshot of a security's current trading information, typically showing the last trade price, the bid and ask, the day's change, high, low, and volume. Quotes can be real time or delayed.
  • Bid – Bid is the highest price that a buyer in the market is currently willing to pay for a security. It is paired with the ask, the lowest price a seller will accept, and the gap between the two is the bid-ask spread.
  • Spread – The spread, or bid-ask spread, is the difference between the highest price a buyer will pay (the bid) and the lowest price a seller will accept (the ask). In options, a spread also means a strategy combining contracts.
  • Order – An order is an instruction an investor gives a broker to buy or sell a security, specifying the quantity and conditions such as price limits, triggers, and how long the instruction remains active.
  • Execution – Execution is the process of completing a buy or sell order, the moment an order is filled at a specific price and quantity. Execution quality covers the price received, the speed of the fill and the likelihood the order is filled at all.
  • Open – The open, or opening price, is the price of a security's first trade when the regular trading session begins, at 9:30 a.m. Eastern for US stocks; it is one of the four OHLC values shown on bar and candlestick charts.
  • Close – Close, or closing price, is the final price at which a stock trades during the regular market session, which on the NYSE and Nasdaq ends at 4:00 p.m. Eastern, and it is the standard price used for daily charts and performance.
  • High – The high is the highest price at which a security traded during a given period, such as a single session, a week, or 52 weeks; together with the open, low, and close it forms the basic OHLC data shown on price charts.
  • Low – The low is the lowest price at which a security traded during a given period, such as one session, a week, or 52 weeks; along with the open, high, and close, it is one of the four standard OHLC values shown on price charts.
  • Volume – Volume is the total number of shares or contracts of a security traded during a given period, usually a day. It measures trading activity and is used to gauge the strength behind a price move.
  • Broker – Broker is the term for a licensed individual or firm that executes buy and sell orders for securities on behalf of clients. Brokerage firms also hold customer assets, provide account services, and may offer research and advice.
  • Exchange – Exchange, or stock exchange, is a regulated marketplace where buyers and sellers trade securities such as stocks, ETFs and options under uniform rules, with transparent prices. The largest US exchanges are the NYSE and Nasdaq.
  • Bourse – Bourse is another word for a stock exchange, used especially for exchanges in continental Europe such as those in Paris and Frankfurt. Like any exchange, a bourse is a regulated marketplace where securities are listed and traded.
  • Share Market – The share market is another name for the stock market: the network of exchanges and trading venues where shares of publicly listed companies are issued and bought and sold. The term is common in the UK, India, and Australia.
  • Index – An index is a statistical measure that tracks the combined price performance of a defined group of securities, such as the S&P 500, the Dow Jones Industrial Average, or the Nasdaq Composite, and is used as a market benchmark.
  • Stock Sector – A stock sector is a broad grouping of companies that operate in the same area of the economy, such as technology, energy, or healthcare. Investors use sectors to compare companies and track where money is flowing.
  • Regular Market Hours – Regular market hours are the standard trading session for US stock exchanges such as the NYSE and Nasdaq, running from 9:30 a.m. to 4:00 p.m. Eastern time, Monday through Friday, excluding exchange holidays.
  • Pre-Market Trading – Pre-market trading is buying and selling stocks before the regular session opens at 9:30 a.m. Eastern, through electronic trading systems; it lets investors react to overnight news but usually offers lower liquidity and wider spreads.
  • After-Hours Trading – After-hours trading is the buying and selling of stocks after the regular session closes at 4:00 p.m. Eastern. Orders route through electronic networks, and trading usually has lower volume and wider spreads than the day session.
  • Stock Market Holidays – Stock market holidays are the weekdays on which major US stock exchanges such as the NYSE and Nasdaq are closed for trading in observance of national holidays, plus a few scheduled early-close sessions around certain holidays.
  • Activity Level – Activity level describes how actively a stock or market is being traded, typically measured by share volume, the number of trades, and turnover. Higher activity usually means tighter spreads and easier order execution.
  • Advances & Declines – Advances & Declines are the counts of stocks that closed higher (advancers) and lower (decliners) on an exchange during a session. Together they measure market breadth: how widely a move is shared across stocks.
  • Liquidity – Liquidity is the ease with which an asset can be bought or sold quickly at a price close to its fair value; a liquid stock has heavy trading volume and a narrow bid-ask spread, while an illiquid one may require price concessions to trade.

Charting and technical analysis

Chart types, patterns and indicators traders read from price and volume.

  • Charting – Charting is the practice of plotting a security's price and volume over time so traders and investors can see trends, support and resistance, and patterns that are hard to spot in a table of numbers.
  • Bar Chart – Bar chart, in stock trading, is a price chart in which each period is shown as a vertical line from the low to the high, with a small left tick marking the open and a right tick marking the close. It is also called an OHLC chart.
  • Candlestick Charts – Candlestick Charts are price charts that draw each time period as a candle showing the open, high, low and close, with a filled or colored body that makes it easy to see whether buyers or sellers controlled the session.
  • Point & Figure Charts – Point and figure charts are a technical analysis chart type that records only significant price changes, using columns of Xs for rising prices and Os for falling prices, with no regular time axis and no plotting of minor fluctuations.
  • Trend – A trend is the overall direction in which a stock or market's price is moving over a period of time. An uptrend has higher highs and higher lows, a downtrend has lower highs and lower lows, and a sideways trend has neither.
  • Trendline – A trendline is a straight line drawn on a price chart connecting two or more lows in an uptrend or two or more highs in a downtrend. It shows the trend's direction and slope and can act as dynamic support or resistance.
  • Support Level – A support level is a price area on a chart where a falling stock has repeatedly stopped declining because buying demand increases there. It acts as a floor until sellers overwhelm it and the price breaks lower.
  • Resistance – Resistance is a price level on a chart where a stock has repeatedly struggled to rise above because selling pressure increases there. It is the counterpart of support, which acts as a price floor.
  • Breakout – Breakout is the term for a price move through a defined level of resistance or support, such as the top of a trading range or a trendline. Traders watch breakouts because they can mark the start of a new trend or a sharp move.
  • Base – Base, in technical analysis, is a period during which a stock's price moves sideways within a relatively narrow range after a decline or advance. It represents consolidation, and traders watch it for a breakout that may begin a new uptrend.
  • Congestion – Congestion is a period when a stock's price moves sideways within a relatively narrow range because buyers and sellers are roughly balanced, often forming a zone that later acts as support or resistance once price breaks out.
  • Ascending Tops – Ascending tops are a chart pattern in which each successive price peak is higher than the one before it. Together with higher lows, a series of ascending tops is the basic definition of an uptrend in technical analysis.
  • Reversal – A reversal is a change in the direction of a price trend, when an uptrend turns into a downtrend or a downtrend turns into an uptrend. Unlike a pullback, a reversal signals that the prior trend has ended.
  • Pullback – A pullback is a brief, relatively shallow decline in a stock's price that interrupts a larger uptrend without ending it. Traders often watch pullbacks as potential entry points at lower prices.
  • Rally – A rally is a period of sustained price increases in a stock, sector, index, or the broader market, usually driven by strong buying demand. Rallies can occur within bull markets or as temporary rebounds in bear markets.
  • Correction – Correction is a decline of at least 10% but less than 20% in a stock, index or other asset from its most recent peak. Corrections are common, typically shorter than bear markets, and often interrupt a longer-term uptrend.
  • Divergence – Divergence is a technical analysis signal that occurs when a stock's price and a momentum indicator or other measure move in opposite directions, suggesting the current trend may be losing strength and could slow or reverse.
  • Acceleration – Acceleration is the rate at which a stock's price momentum is changing. In technical analysis it shows whether a move is speeding up, holding steady, or losing force, often before the price trend itself turns.
  • Relative Strength – Relative strength is a measure of how a stock, sector, or asset has performed compared with a benchmark such as the S&P 500 or a group of peers. A rising relative strength line means it is outperforming.
  • Bollinger Bands – Bollinger Bands are a technical indicator consisting of a moving average with an upper and a lower band set a number of standard deviations away. The bands widen when volatility rises and narrow when it falls.
  • Fibonacci Ratios – Fibonacci Ratios are percentages derived from the Fibonacci number sequence, chiefly 23.6%, 38.2%, 61.8% and 161.8%, that technical analysts use to estimate where a pullback might find support or where a move might extend.
  • Bear Trap and Bull Trap – Bear Trap and Bull Trap are terms for false price signals. A bull trap is a breakout above resistance that quickly fails and reverses lower; a bear trap is a breakdown below support that quickly reverses higher, catching sellers off guard.
  • Volatility – Volatility is a measure of how widely and quickly a security's price moves up and down over time. It is commonly expressed as the annualized standard deviation of returns; higher volatility means larger, less predictable swings.

Company fundamentals

Financial statements and measures used to value a business.

  • Fundamental Analysis – Fundamental analysis is a method of estimating a stock's intrinsic value by studying the company's financial statements, earnings power, competitive position, management, and the wider economy, then comparing that value with the market price.
  • Annual Report – Annual reports are yearly documents in which public companies present their financial statements, business results, risks, and outlook. In the US, the detailed regulatory version is the Form 10-K filed with the SEC.
  • Balance Sheet – Balance sheet is the financial statement that lists what a company owns (assets), what it owes (liabilities), and the owners' stake (shareholders' equity) at a specific date. It always balances: assets equal liabilities plus equity.
  • Income Statement – An income statement is a financial statement that reports a company's revenue, expenses, and resulting profit or loss over a specific period, such as a quarter or fiscal year; it is also called a profit and loss (P&L) statement.
  • Cash Flow Statement – Cash Flow Statement is a financial statement that shows how much cash a company generated and used during a period, split into operating, investing and financing activities, revealing whether reported profits are turning into actual cash.
  • Earnings – Earnings are a company's profit, also called net income, after subtracting all costs, interest and taxes from revenue during a period. Expressed per share as EPS, earnings are a primary driver of stock valuations.
  • P/E Ratio – The P/E ratio (price-to-earnings ratio) is a valuation measure calculated by dividing a stock's share price by its earnings per share, showing how many dollars investors pay for each dollar of a company's annual profit.
  • Dividend – Dividend is a distribution of a company's profits to its shareholders, usually paid in cash on a regular schedule such as quarterly, and decided by the board of directors. Some companies also pay dividends in additional shares.
  • Yield – Yield is the income an investment generates, such as dividends or interest, expressed as an annual percentage of its price or value. For stocks it usually means dividend yield; for bonds it often means current yield or yield to maturity.
  • Buyback – Buyback, or share repurchase, is when a public company uses its cash to buy back its own shares from the market, reducing the number of shares outstanding and increasing each remaining shareholder's ownership stake.
  • Capitalization – Capitalization, usually meaning market capitalization, is the total market value of a company's outstanding shares, calculated by multiplying the current share price by the number of shares outstanding.
  • Asset – Asset is the term for anything of economic value that a person, company, or fund owns or controls and expects to provide future benefit, such as cash, stocks, bonds, property, equipment, or intellectual property.
  • Liabilities – Liabilities are the financial obligations a company owes to others, such as loans, bonds, accounts payable, and lease payments; they appear on the balance sheet and are settled over time with cash, goods, or services.
  • Analyst Ratings – Analyst ratings are recommendations issued by research analysts, such as buy, hold, or sell, that summarize their view of a stock's prospects. They usually come with a price target and a written report explaining the reasoning.
  • IPO (Initial Public Offering) – An IPO (Initial Public Offering) is the first sale of a company's shares to the public, after which the stock lists and trades on an exchange such as the NYSE or Nasdaq, turning a privately held company into a public one.
  • Bankruptcy – Bankruptcy is a legal process in which a company that cannot pay its debts either reorganizes under court protection or liquidates its assets to repay creditors. In the US, corporate cases are typically filed under Chapter 11 or Chapter 7.
  • Blue-Chip Stocks – Blue-chip stocks are shares of large, well-established companies with long operating histories, strong balance sheets, and widely recognized brands. They are often seen as relatively stable holdings, though they still carry market risk.

Trading strategies and risk

Ways traders take positions, manage risk and get burned.

  • Day Trading – Day Trading is the practice of buying and selling stocks or other securities within the same trading day, closing all positions before the market closes, in an attempt to profit from short-term price movements.
  • Short Selling – Short selling is a strategy in which an investor borrows shares, sells them at the current price, and aims to buy them back later at a lower price, returning them to the lender and keeping the difference as profit.
  • Margin – Margin is borrowed money a broker lends an investor to buy securities, with the account's holdings serving as collateral; trading on margin increases buying power and leverage but also magnifies losses and adds interest costs.
  • Margin Call – A margin call is a demand from a broker for an investor to deposit more cash or securities, or sell holdings, because the equity in a margin account has fallen below the required maintenance level.
  • Leverage – Leverage is the use of borrowed money, or of instruments such as options and futures, to control a position larger than the investor's own capital, which magnifies both potential gains and potential losses.
  • Averaging Down – Averaging down is the strategy of buying additional shares of a stock after its price has fallen, which lowers the investor's average cost per share. It can reduce the break-even price but also increases exposure to a losing position.
  • Arbitrage – Arbitrage is the practice of buying an asset in one market and simultaneously selling the same or an equivalent asset in another at a higher price, capturing the difference. Pure arbitrage aims to profit with little or no market risk.
  • Carry Trade – Carry Trade is a strategy of borrowing in a currency or asset with a low interest rate and investing the proceeds in one with a higher rate, aiming to earn the difference, known as the carry, as long as exchange rates stay stable.
  • Haircut – A haircut is the percentage discount a lender or clearinghouse applies to the market value of an asset used as collateral, so a loan is backed by more value than it lends; informally, it also means accepting a loss on an investment.
  • Alpha – Alpha is the portion of an investment's return that cannot be explained by its market exposure. A positive alpha means the investment beat the return its risk level would predict; a negative alpha means it fell short.
  • Beta – Beta is a measure of how sensitive a stock's returns are to movements in the overall market. A beta of 1 means the stock tends to move in line with the market; above 1 means more volatile, and below 1 means less.
  • Portfolio – A portfolio is the full collection of investments held by an individual or institution, such as stocks, bonds, funds, cash, and other assets, managed together to meet specific goals for return, risk, and time horizon.
  • Investment Risks – Investment risks are the possibilities that an investment will lose value, earn less than expected, or be hard to sell. They include market, company, interest rate, inflation, liquidity, and credit risk, among others.
  • Pump and Dump – A pump and dump is a form of securities fraud in which promoters hype a thinly traded stock with misleading claims to drive the price up, then sell their shares to the buyers they attracted, leaving them with losses.
  • OTC Stocks – OTC stocks are shares that trade over the counter, through a network of broker-dealers rather than on a national exchange such as the NYSE or Nasdaq; they include small companies, foreign issuers, and firms that do not meet exchange listing standards.
  • Pink Sheet Stocks – Pink sheet stocks are over-the-counter securities quoted on the Pink market run by OTC Markets Group, a tier with minimal requirements that often includes small, thinly traded, or limited-disclosure companies.

Options, futures and derivatives

Contracts whose value comes from another asset.

  • Derivatives – Derivatives are financial contracts whose value is derived from the price of an underlying asset, index, rate or event, such as a stock, bond, commodity or currency. Common types include options, futures, forwards and swaps.
  • Option – An option is a contract that gives its buyer the right, but not the obligation, to buy (call) or sell (put) an underlying asset at a specified strike price on or before a set expiration date, in exchange for a premium paid to the seller.
  • Call Option – Call Option is a contract that gives its buyer the right, but not the obligation, to buy 100 shares of an underlying stock at a set strike price on or before an expiration date, in exchange for paying a premium.
  • Put Option – A put option is a contract that gives its buyer the right, but not the obligation, to sell 100 shares of an underlying stock at a set strike price on or before an expiration date. Puts gain value as the stock falls.
  • Covered Call – Covered Call is an options strategy in which an investor who owns at least 100 shares of a stock sells a call option on those shares, collecting premium income in exchange for agreeing to sell the shares at the strike price if assigned.
  • Credit Spread – Credit Spread most often refers to an options strategy that sells one option and buys a cheaper option of the same type and expiration, collecting a net premium with capped risk. In fixed income, it is the yield gap between a corporate bond and a Treasury.
  • Futures Contract – A futures contract is a standardized, exchange-traded agreement to buy or sell a specific quantity of an asset, such as oil, corn, a currency, or a stock index, at a price agreed today for delivery or cash settlement on a set future date.
  • Currency Futures – Currency Futures are standardized, exchange-traded contracts that obligate the buyer and seller to exchange a specified amount of one currency for another at a price agreed today, on a set future date, with daily mark-to-market settlement.
  • Witching Hour – The witching hour is the final hour of trading, from 3:00 to 4:00 p.m. Eastern, on days when several types of derivatives expire at once, most notably triple witching, often called quadruple witching.

Bonds, commodities and metals

Markets beyond stocks.

  • Bond – Bond is the name for a debt security in which an investor lends money to a government, municipality, or corporation in exchange for periodic interest payments and the return of the principal on a set maturity date.
  • Commodities – Commodities are basic raw materials and agricultural products, such as crude oil, natural gas, gold, copper, wheat and coffee, that are standardized enough to be traded interchangeably on exchanges, mostly through futures contracts.
  • Gold Bullion Investing – Gold bullion investing is buying physical gold, usually bars or coins of high purity, whose value is based mainly on metal weight and the market price of gold rather than on rarity or collectible appeal.
  • Silver Bullion Investing – Silver bullion investing is buying physical silver in the form of bars, rounds, or coins valued mainly for their metal content and purity, usually measured in troy ounces, rather than for collectible value.
  • ETFs – ETFs, or exchange-traded funds, are investment funds that hold a basket of securities such as stocks, bonds or commodities and trade on a stock exchange throughout the day at market prices, just like individual shares.

Economy and markets

Economic conditions that move the whole market.

  • Bull Market – Bull market is the term for a sustained period of rising stock prices, commonly defined as a gain of 20% or more from a recent low in a major index. Bull markets are usually accompanied by investor optimism and economic growth.
  • Bear Market – Bear market is the term for a sustained decline in which a major stock index or individual security falls 20% or more from its recent high, typically amid widespread pessimism. The opposite is a bull market.
  • Inflation – Inflation is the rate at which the general level of prices for goods and services rises over time, reducing the purchasing power of money; in the US it is commonly measured by the Consumer Price Index (CPI) and the PCE price index.
  • Deflation – Deflation is a sustained decline in the general level of prices for goods and services across an economy, which increases the purchasing power of money but can discourage spending and investment and make debts harder to repay.
  • Stagflation – Stagflation is an economic condition that combines stagnant or slow growth, high unemployment, and persistently high inflation. It is hard to fix because policies that reduce inflation can further weaken growth.
  • Recession – A recession is a significant decline in economic activity spread across the economy and lasting more than a few months, typically visible in falling output, employment, income, and spending.

Retirement and savings

Accounts and protections for long-term savers.

  • Individual Retirement Account (IRA) – An Individual Retirement Account (IRA) is a tax-advantaged account that lets US individuals save and invest for retirement, either with tax-deferred growth (traditional IRA) or tax-free qualified withdrawals (Roth IRA).
  • Traditional IRA – A traditional IRA is an individual retirement account where contributions may be tax-deductible and investments grow tax-deferred. Withdrawals in retirement are generally taxed as ordinary income.
  • Roth IRA – A Roth IRA is an individual retirement account funded with after-tax dollars. Investments grow without annual tax, and qualified withdrawals in retirement, including earnings, are free of federal income tax.
  • Capital Gains – Capital Gains are the profits realized when you sell an investment, such as a stock, for more than its cost basis. In the US, gains on assets held over one year are generally taxed at lower long-term rates than short-term gains.
  • FDIC Insurance – FDIC Insurance is protection provided by the Federal Deposit Insurance Corporation, a US government agency, that guarantees deposits at insured banks up to $250,000 per depositor, per insured bank, for each account ownership category.

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For information only, not investment advice. See the disclaimer.