Options trading slang

Home Contact Terms of Use Privacy Advertise Site Map Search. When the tide comes in, all the boats rise. When the stock market is quickly rising, there is a tendency for most stocks to increase in value due to over-optimism. The opposite is, When the tide goes out, all the boats sink , which is due to over-pessimism. When a company offers to buy another company at a signficant premium.

The intent of a high offer price is to entice shareholders of the target company to vote in favor of a merger, and against its management. Usually considered a hostile takeover offer. The Friday after Thanksgiving, which is a very popular shopping day for retailers. In the black means to be profitable.

After a large sell-off or drop in the market, a slang term for picking oversold stocks. A foolish method of investing, when you buy a stock and completely forget about it indefinitely. When stock prices are extremely overvalued, and not justifiable by future increases in earnings.

Banks buying more SIVs risky debt to gain higher returns had greatly contributed to the liquidity crisis of , as many of the SIV funds became insolvent. When trading stops on the New York Stock Exchange and Nasdaq each day, a bell is rung to signal the event.

When the Federal Government incurs massive budget deficits, it must borrow tremoundous sums of money. This effectively "crowds out" private businesses from borrowing in the capital markets as there is less money available for loans.

After a stock or even the entire market has dropped substantially, there is often a moderate bounce to the up side. This bounce may be caused by value investors believing the stock had become undervalued at this beaten down price, or by short sellers covering their positions as shorting was compounding on the way down. When the Federal Reserve Governors imply that interest rates may be going down soon.

The opposite of hawkish. The theory is that some companies may go bankrupt, but one or more may survive and incur large gains in the stock price. A precursor to such an event is often extremely negative market futures just before opening. Volatility is extreme during Flash Crashes due to automated buying and selling. An obsolete saying used in a long-term bear market for stocks.

Bonds tend to outperform stocks during recessions. When the Federal Reserve Governors imply that interest rates may be going up soon. The opposite of dovish.

Trading Slang - GreekShares

The Dow Jones Industrial Average hit on Tuesday January 6, , after not reaching since January 26, On Wednesday January 7, , Joe Granville announced in his investment newsletter to "Sell Everything!

The Dow kept falling until August, Mergers, or companies buying other companies, often consummate a deal over a weekend, and then publicly announce it on a Monday. The Unemployment Rate and the Inflation Rate added together. The term was made famous by President Jimmy Carter during his presidential campaign. A group of 50 large cap overvalued stocks that greatly influenced the market in the s. When trading starts on the New York Stock Exchange and Nasdaq each day, a bell is rung to signal the event.

When a group of investors illegally move a stock by trading it all at the same time. This happens every day, just watch the tape of most active light volume stocks, but don't get sucked in. Day trader newsletter emails can cause such moves. The final hour of trading on a Friday when stock index futures, single stock futures, stock index options, and stock options all expire. This happens on the third Friday in March, June, September, and December. This used to be called the Triple Witching Hour.

A s author created a portfolio of stocks by throwing darts randomly at a newspaper stock price table. The dart portfolio outperformed the collective results of a sideways market. After a large sell-off in the market, there is a tendency for the market to bounce back right away. It is caused by computerized trading programs.

It's also known as a V rally due to how it appears on a chart. The market is often seasonal, rising in late winter at times. The market can run out of steam in May, with stock prices falling, causing the Summer Doldrums. Stealing a few pennies from trades by specialists or market makers. A state of the economy when Unemployment is high and Inflation is high. Quite often, stagflation is caused by massive deficit spending by the Federal Government.

This deficit spending reduces private sector output with higher inflation. Stocks tend to remain flat or drop during the summer. Many people are on vacation, with trading volume usually dropping also.

Unethical and illegal trading by specialists or market makers. A specialist may buy a stock for themselves from John Q. Public even though a better price is available from another seller. The specialist can view bid and ask prices and then manually mis-match them, or see ahead to a less favorable price.

It happens all the time in this editor's experience, by observing how long it takes for a stop order to execute after the stop price was reached.

This practice is a form of shimming. A situation where a large block of stock is put up for sale, but not enough buyers are available for purchase, and a market maker is unable to buy the imbalance.

Options lingo - Understanding stock options investing | Option Trading Guide

Lightly traded and tightly held stocks are considered temporarily illiquid during such imbalances. On occasion, a trading halt is put into place until enough buyers are available to purchase the deficit. On rare occasion, a handful of buyers can buy the stock at a huge discount if the stock was not halted during the imbalance. On the New York Stock Exchange, large stocks usually have a "delayed open" for such imbalances, as a trading specialist will fill the order by lining up buyers for the block, and then open trading for the stock for the day.

The final hour of trading on a Friday when stock index futures, stock index options, and stock options all expire. See Quadruple Witching Hour. A privately held company that had quickly reached one billion dollars in revenue, and is now considering going public.

Such companies appear to be "mythical" like a unicorn due to their swift growth, and investment banks may actually hesitate to bring them public.

Fast growing large companies awaiting favorable market conditions to go public are often referred to as unicorns. The term derives from how the move appears on a chart. Also known as the Rubber Band Effect.