Essential Financial and Stock Market Terminology

Vocabulary 1

• 1) A mortgage is a loan to buy property.
• 2) Money you put in the bank is called a deposit.
• 3) Money paid to a retired person is called a pension.
• 4) Securities representing part-ownership of a company are called stocks or shares.
• 5) The money invested in a business is its capital.
• 6) Bonds are interest-paying securities issued by companies that need to borrow money.
• 7) A takeover is when a company gains control of another one by buying its stocks.
• 8) A merger is when two formerly separate companies join together.

Vocabulary 2

• 1) Conglomerates: Groups of companies that have joined together.
• 2) Depositors: People who place money in bank accounts.
• 3) Deregulated: Abolished or ended rules and restrictions.
• 4) Fines: Sums of money paid as penalties for breaking the law.
• 5) Prohibited: Made it illegal to do something.
• 6) Regulation: Control of something by rules or laws.
• 7) Repealed: Cancelled or ended (a law).
• 8) Underwriting: Guaranteeing to buy a company's newly issued stocks if no one else does.

Vocabulary 3

• 1) Bulls: A name for investors who buy shares because they expect their price to rise.
• 2) Bears: A name for shareholders who sell because they expect the price to fall.
• 3) Bubble: A period of rapidly rising share prices, followed by a quick collapse.
• 4) Collateral: Assets a borrower uses to secure or guarantee a loan.
• 5) Shares: Certificates representing part-ownership of a company.
• 6) Institutional investors: Financial organizations that own a lot of shares.
• 7) Day traders: People who buy and re-sell shares in a very short time, often just a few hours.
• 8) Raise capital: To get money from investors with which to run a business.
• 9) Issue: To offer securities for sale to financial institutions and the public.
• 10) Bankruptcy: When you have no money to pay your debts, so you have to sell your assets.

Terms for Market Movement

To Go Up

Rally - Stage comeback - Goes through the roof

To Go Down

Take a tumble - Under pressure - Take a beating

Major Stock Indices

The following are major stock market indices:

• 1) Dow Jones: New York
• 2) FTSE 100: London
• 3) Nikkei: Tokyo
• 4) CAC 40: Paris
• 5) DAX: Frankfurt
• 6) Hang Seng: Hong Kong
• 7) NASDAQ: New York
• 8) Bovespa: Sao Paulo
• 9) MICEX: Moscow
• 10) Straits Times Index: Singapore