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Stock Market Help

Here is a list of common financial terms. Click on the letter that corresponds with the first letter of the financial term to get the definition.

PEG Ratio

The PEG ratio is a valuation metric for determining the relative trade-off between the price of a stock, the earnings generated per share (usually current-year or forward earnings), and the company's expected growth.

It is a great way to compare valuations across industries as some sectors have inherently higher P/E's than others. Adding the growth rate to the equation helps to level the playing field. Generally stocks with a PEG ratio below 1.0 are considered undervalued and vice versa, but it is still just one metric.

Phone Switch

Some mutual funds allow the client to sell his or her shares and place proceeds in either a Money Market Fund or another Fund in its family, simply by telephoning a number.

Pink Sheets

The daily listing of stocks, prices, and market makers for over-the-counter (OTC) stocks too small in capitalization to be listed in the NASDAQ system.


All taxable and tax-deferred investment accounts and their contents (appreciating & income producing assets). More broadly, your portfolio holds all your investments.

Portfolio %

Indicates what portion of an account is invested in a given security.

Precious Metals Equities

Mutual fund investing primarily in stocks of companies who mine precious metals, such as gold, silver, platinum, etc. The stock prices of these companies can also reflect the rising or falling values of the precious metals that the company mines.

Preferred Stock

Stock that pays dividends at a stated rate and has priority over common stock in dividend payments and asset liquidation. Preferred stock does not ordinarily carry voting rights.

Price (52-Week High and 52-Week Low)

The highest and lowest trade prices achieved during the past 52 weeks.
Note: Compare current price to the 52-week high or 52-week low to get an estimate of where the stock is trading in its year range.

Price (Date)

The market price of an investment, at any given time. Current price is the market price as of the latest price update. Average price is the arithmetic average of the price of all lots of an investment.

Price (Trade)

Bonds. The actual trading prices for listed bonds. For over-the-counter bonds, the bid price is shown. Bonds are generally listed in lots of 1,000. Therefore, if Price = 99.5 (=99.5% of $1,000) = $995, at maturity, the price = 100% of the face value, or $1,000. Latest Price is from last trading day of the indicated month. This view displays: Maturity; Outstanding (millions); Latest, High, and Low Prices. Stocks and Options. The last trade price. Stocks that do not trade frequently display the bid price in the Price column. Bid price is what the buyer is willing to pay for the stock or options. Stocks also show daily highs and lows. Indices. The last value of a given index.

Price/Book Ratio

The latest price per share divided by the last fiscal year book value per share, for a given corporation.


The original amount or face value of a investment, typically bonds and CDs, on which interest is owned or earned. Interest is paid based on a percent of the principal (a stated interest or coupon rate). At maturity, the entire principal is returned to investor; however its purchasing value may be diminished by inflation.


The sum of net amounts of all short open lots. Total proceeds is the sum of net proceeds of all short open investments in a given account. Average proceeds is for short investments what average cost is for long investments. See Average Cost.

Projected 5-Year EPS Growth Rate

The estimated average annual growth rate of fiscal year earnings per share for the next five years for a given corporation.

Projected Yield

Projected income divided by current value of a given account.


A formal written offer to sell securities to prospective shareholders. It is very useful to read the prospectus for a mutual fund before buying shares because it describes the philosophy, past performance, and fees.

Purchase Price

The market price you receive when you buy or sell short a security. Same as opening price.

Put Option

A put option gives the owner the right, but not the obligation, to sell the underlying stock at a given price (the strike price ) by a given time (the expiration date). The owner is speculating that the option will go up in value and the underlying stock will go down in value. The purpose can be to either speculate with the option (hope it goes up and sell for a profit) or trade the underlying stock at a locked in price if the stock price goes down enough. For example, an AAA MAR 65 put would give the owner the right to sell 100 shares of AAA at $65 (strike price) per share between now and the third Friday in March (expiration date).

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