Know about some of the most common Share Market Jargons or Stock Market Jargons used in India.

Stock Market, like any other industry, has its fair share of exclusive terms. However, that doesn’t mean you can’t use them anywhere else. It is just people tend to associate with some terminologies better.

So, if we are trying to explain the cause and effect of a sudden rise in a stock’s price, it would be best to use these so-called stock market jargons.

So, this article consists entirely of such terms that we use in the stock market.


Share Market Jargons used in India

Share Market Jargons are some specific terms used in share market and related activities. They are best means of understanding among the investors or the shareholders in the stock market.

Share Market JargonsThey use these terms to discuss strategies, stock trading, charts, patterns, shares, and everything related to share market.

One needs to be acquainted with all these terminologies to be able to make profits in the share market.

Jargons aid in understanding and improving the relationship between the share market and the developments happening in the economy.

The most commonly used jargons are bull market, bear market, trend, face value, upper/lower circuit, long/short position, turnover, server buzz, open interest, and so on.

Any trader should understand the basic share market jargon in order to excel in the industry. If you want to sustain share market investment and trading, then here are some important terms to learn.


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    Share Market Jargons

    So here are the stock market terminologies that you should be aware of:

    Bull Market or Bullish Market

    It is a scenario where the overall stock value is going up, or it is likely to rise over a period of time.

    Of course, the market is always volatile, and anything can go south, and you may end up being wrong.

    However, the idea of you believes that the stocks’ price will continue to grow, make you a bullish.

    Bear Market

    It is an opposite hypothetical scenario where you believe the stocks’ price will fall over a span of time. So, in your views, it is a Bear Market.

    Subsequently, when you tend to believe this concept, makes you a bearish.

    Stock Market Trend

    Whether you are bullish or bearish, you tend to believe a certain pattern in the stock market. We call that market pattern the Trend.

    It usually indicates the market direction, whether it is tilting towards a bull or a bear.

    Now, there is another Trend as well where there is no significant movement in the stocks’ price – it is the sideways Trend.


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    Face value of a stock and Volume

    When you buy a stock, it has a default value which, in the stock market terminology is called the Face Value. So, it is the fixed denomination which the company set for a particular stock.

    Even though the Face Value, which sometimes also called the Par Value, is mostly a corporate affair, but it is pivotal you have an idea of what it is.

    You see it is the benchmark price where you can say the company made a profit or it has incurred a loss while trading. Based on that, you may get dividends if the company make a profit.

    52 week high & 52 week low

    For traders who like to keep track of a stock’s price before buying, the 52-week high/low price of a share is essential.

    So, it is the highest and lowest recorded price of any particular stock over a span of 52 weeks. What it does is; it gives an idea of the stock’s overall performance over the past year.

    It also indicates the consistency of a share. Based on that, you can decide how much risk you are willing to take.

    All Time High & All Time Low

    This is also a range of stock price that all traders who value statistical data, would love to have.

    Similar to the 52-weeks High/Low price, it is the cost of any particular stock’s performance since that time it is there.

    So, you will get the all-time recorded highest and lowest price. By this, you can guess whether the company is growing or it is diminishing. Who knows, there can be a resurgence as well.

    Upper Circuit & Lower Circuit

    The stock exchange regulates the stocks’ price and set a price band for a day.

    Now, based on any particular or series of events of a company, the exchange mandates an upper and a lower limit of a stock’s price.

    That price band is the Upper Circuit/Lower Circuit. So, in simple terms, it is the highest price and the lowest price where you can trade your shares on that given day.


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    Long Position

    We have shared the basic idea of being bullish, Long Position is the ultimate outcome of carrying that attitude.

    You see, it is an act when you buy a stock expecting that to hold its market value for a certain period of time.

    Of course, we will get to know how right or wrong you are in the future. But as you buy a stock, you hope it will stay on a positive trajectory for a long time.

    Short Position:

    This is a high-risk concept where you can sell your stocks before ever owning it. Now, if you are confused, don’t be.

    The stock exchange, or more specifically, your stockbroker can avail the facility where you can borrow a certain unit of shares from them and sell it to any interested buyer.

    Now, you may wonder why you would like to do that? Here you are hoping that a particular stock’s price would fall after a certain time.

    So, let’s say, you Short trade a stock at Rs.100 today, and two days later, you are carrying a bearish attitude that the price would fall by Rs.20.

    Meanwhile, you don’t own those stocks that you would sell after two days. So, you borrow those shares and sell them right away.

    After two days, you need to buy those exact number of shares and repay your broker. The only catch is the price has to go down; otherwise, you will incur a significant loss.

    Square off

    Whether you are in a Long Position or a Short Position, there comes a situation where you need to close the deal.

    So, if you are in a Long Position, a Square off mean you are close to selling the stocks you own.

    Subsequently, if you are shorting, a Square off suggests you are ready to buy the stocks and pay off your broker.

    Intraday Position

    You can wrap up a stock trading within a day. In fact, you can do square off a trade multiple times in a day.

    As long as all the stock trading activities you did complete in a day, that respective position is the Intraday position.

    OHLC – Open, High, Low, Closing

    OHLC is a simple abbreviation that explains the entire performance of a particular stock. O stands for the price at which the stock opened in the market.

    H represents the highest price of the day, whereas L stands for the lowest stock price on that particular day. Finally, C stands for the closing price of any particular stock of that very day.

    Volume

    The Volume of any particular stock indicates the total number of traded company shares. This includes both the shares that all the traders aggregately buy and sell in a given day.

    Market segments

    On a typical day at the stock exchange, several kinds of financial trading do takes place. So, you can say a Market Segment is the one that most of the financial activities happened in a day.

    There are three kinds of Market Segments – Capital Market, Futures and Options, and Wholesale Debt Market.

    Now, all the usual dealings such as equity, preference shares, warrants, and exchange-traded funds fall in the category of Capital Market. The likes of equity derivatives are under Futures and Options.

    Finally, sector undertaking, corporate bonds, corporate debentures, and so on fall directly under Wholesale Debt Market.


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    Capital market

    This market basically helps in the growth of the country and decides the economic growth of the country.

    If you are planning to have a short term investment, then choose money market and for long-term investors, capital market will suffice.

    Capital market deals with the financial instruments and commodities that are long term securities and this is the only thing which you need to keep in your mind.

    In the capital market, buyers and sellers engage in the trading of any given financial securities. The players in the capital market are sellers and institutions. The capital market simply provides a link between investors and wealth creators.

    The capital market simply provides a link between two persons, one person has the money and the other person is in need of the money.

    So, the person who needs the money borrows the money from the person who has the money and the person who has the money lends the money on a certain rate of interest.

    This money is used for productive purposes and creates a wealth economy in the long term and any long-term work gives long-term productivity.

    Support System, Future and Options

    The capital market provides support to the system of capitalism of the country. One of the most important of the capital markets is to provide the ease of transaction for both the investor and companies.

    Both parties should be able to find each other with ease and the legal aspect of things should go smoothly.

    Functions of the capital market include facilitating the trading of securities apart from minimizing the transaction and data cost.

    It helps by mobilizing the savings to help the trader finance long term investments. Also, it encourages better ownership of productive assets and office insurance against the risk. Anything could happen with market and pricing when it comes to derivative trading.

    Future and options simply mean that if one would invest in the market and show interest in the market, the person will get to know about the future risks and more options in the market.

    Wholesale debt market

    This division of the market simply deals with the income of securities. People who need money lend their securities like bonds, stocks, and many other things to borrow the money from the market.

    This market simply deals with the economy of the country and helps in the growth of the country. The government borrows money from the whole debt market to build the economy of the country.

    This market helps in the development of the country by giving money to the government in exchange for something like bonds, stocks, and many other things.


    Conclusion on Share Market Jargons

    Trading and its analysis majorly rely on data and trading summary from the previous day.

    The market movements could be in cash and derivatives and these jargons serve as an indicator to help traders in understanding the market status.

    The data will be available in any stock market related websites if they have daily statistics.

    Even if you do not have the knowledge to operate analytical tools, understanding the jargons will help you simplify the existing charts.


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