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Stock market glossary (A–Z)
- Ask price
- The lowest price a seller is willing to accept right now.
- ASBA
- Application Supported by Blocked Amount — your IPO money stays in your bank, blocked, until allotment.
- Bear market
- A long period of falling prices, often a fall of 20% or more from a peak.
- Bid price
- The highest price a buyer is willing to pay right now.
- Bull market
- A long period of rising prices.
- Candlestick
- A chart bar showing the open, high, low and close for a period.
- Demat account
- An account that holds your shares in electronic form.
- Doji
- A candle where open and close are almost equal — a sign of indecision.
- Expense ratio
- The yearly fee a mutual fund charges, as a % of your investment.
- F&O
- Futures and options — leveraged derivative contracts. High risk.
- FII / DII
- Foreign and domestic institutional investors — big money that can move markets.
- Hammer
- A candle with a small top body and a long lower wick; after a fall it can signal buyers returning.
- Index fund
- A mutual fund that copies an index such as Nifty 50, usually at low cost.
- IPO
- Initial Public Offering — a company's first sale of shares to the public.
- Leverage
- Trading with borrowed money or margin; it magnifies both gains and losses.
- Liquidity
- How easily you can buy or sell without moving the price much.
- Market cap
- Share price × number of shares — the market value of a company.
- Net Asset Value — the price of one unit of a mutual fund.
- Nifty 50
- NSE's index of 50 large companies across sectors.
- P/E ratio
- Share price divided by earnings per share — how much you pay for ₹1 of profit.
- Paper trading
- Practice trading with virtual money and no real risk.
- Position sizing
- Choosing quantity so a stop-loss hit costs only a small % of capital.
- Promoter pledge
- Shares that owners have pledged for loans — high pledging is a red flag.
- Resistance
- A price level where selling pressure has repeatedly stopped a rise.
- Risk–reward
- How much you can lose vs how much you aim to gain on a trade, e.g. 1:2.
- ROE
- Return on equity — profit earned on shareholders' money.
- RSI
- Relative Strength Index, a 0–100 momentum indicator.
- SEBI
- Securities and Exchange Board of India — the market regulator.
- SIP
- Systematic Investment Plan — investing a fixed amount regularly in a mutual fund.
- Stop-loss
- A pre-decided exit price that limits your loss if a trade goes wrong.
- Support
- A price level where buying has repeatedly stopped a fall.
- VWAP
- Volume-weighted average price for the day; intraday traders use it as a guide.
- Volatility
- How much and how fast a price moves up and down.
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