Stock Telephone Substitution Transactions - Price Terminology Glossary

List of Terms relating to Indian Stock Exchange ↓

List of the of import terms relating to indian stock exchange transactions.

1. Group Influenza A virus subtype H5N1 Shares

These are the listed equity shares of large in addition to good established companies having wide investor base. These shares are actively traded in addition to for these shares the facility for carrying frontwards a transaction from 1 accounting menstruum to or so other is available. Naturally, these shares attract a lot of speculative multiples. These facilities are non available for grouping B shares. However, shares tin give notice last moved from Group B to Group Influenza A virus subtype H5N1 in addition to vice versa depending on criteria for shifting. For representative the Mumbai Stock Exchange has set downward several criteria for shifting shares from Group B to Group A; such as, an equity base of operations of Rs. 10 crores, a marketplace position capitalization of Rs. 25-30 crores, a populace asset of 35 to xl percent, a shareholding population of 15,000 to 20,000, skillful dividend paying status, etc.

2. Group B Shares

These are those listed shares which do non follow the criteria prescribed for Group Influenza A virus subtype H5N1 shares. Group B shares are 1 time again divided into B1 in addition to B shares on BSE. B1 shares stand upward for good traded scrips amidst B grouping in addition to they stimulate got weekly settlements.

3. Group C Shares

Under Group C, exclusively strange lots in addition to permitted securities are included. Influenza A virus subtype H5N1 number of shares that are less than the marketplace position lot are called strange lots. Market lot refers to the minimum number of shares of a item safety that must last transacted on a stock exchange. Odd lots stimulate got short town 1 time inwards a fortnights or 1 time on Saturdays. Permitted securities are those that are non listed on a stock telephone substitution but are listed on other exchanges inwards India. So they are permitted to last traded on BSE. Odd lots cannot last easily transacted on the stock telephone substitution in addition to so they are illiquid inwards nature.

4. Arbitration

Arbitration is a quasi-judicial procedure to resolve a dispute which is faster in addition to inexpensive. The stock telephone substitution facilitates the procedure of arbitration betwixt the fellow member in addition to their clients. The disputes betwixt the parties are resolved through arbitration inwards accordance alongside the by-laws of the exchange. Arbitration is required inwards the matters such equally short town of claims, differences in addition to disputes betwixt 1 fellow member in addition to another, betwixt a fellow member in addition to his clients, sub-brokers or authorised clerks etc.

5. Arbitrage

Arbitrage is undertaken to brand a turn a profit out of differences inwards prices of a safety inwards 2 dissimilar markets. It is a highly skilled speculative activity. If the prices of a safety differ substantially inwards the 2 stock markets, the speculator purchases the safety inwards the marketplace position where it is inexpensive in addition to sells it at a turn a profit inwards or so other marketplace position where it is quoted high in addition to thus makes huge profit. The speculator has to deed rattling fast since the prices are highly sensitive in addition to they may larn equalised inside a curt bridge of time.

The arbitrage may last carried on betwixt the 2 markets inside the dry soil or inwards 2 dissimilar countries. The quondam is called 'domestic arbitrage' in addition to the latter 'foreign arbitrage'. Arbitrage ultimately helps inwards equalising the prices of securities at dissimilar places; hence, it is beneficial to market. The brokers who send arbitrage activity are called arbitragers.

6. Auction

An auction is a machinery utilised past times the telephone substitution to fulfil its obligation to a counter political party fellow member when a fellow member fails to deliver skillful securities or brand the payment. The stock exchange, inwards such cases, arranges to purchase skillful securities through auction in addition to deliver them to the buying broker or arranges to realise the cash in addition to pay it to the selling broker.

7. At Best Order

It is an guild from an investor for the purchase or sale of securities wherein the investor does non specify a cost at which the purchase or sale of securities should last made past times broker on his behalf. Such guild must last executed past times the broker at best possible price. The customer may likewise ready a fourth dimension frame inside which the guild has to last executed. e. g. "Buy 200 Reliance Industries at best".

8. Authorised Clerk

An authorised clerk is a representative appointed past times a stock broker to assist him inwards the securities trading. Influenza A virus subtype H5N1 broker cannot stay nowadays all the fourth dimension on trading flooring of stock exchange, hence he requires assistants to send out trading activities on his behalf. As per the rules of the stock exchange, each broker tin give notice employ a specified number of authorised clerks to transact his business. They are likewise called 'member assistants'. At Bombay, Madras & Calcutta Stock exchanges the number of authorised clerks allowed past times a broker are 5, iii in addition to 8 respectively. Generally, authorised clerks are given ability of attorney to deed on behalf of broker & hence they tin give notice sign on behalf of brokers.

9. Bad Delivery Cell

A delivery of shares turns out to last bad if in that location is a society objection on concern human relationship of signature difference, or if shares are fake, forged or stolen etc. In such a representative the investor tin give notice approach the bad delivery jail cellular telephone of stock telephone substitution through his broker for correction or replacement alongside skillful delivery.

10. Bid in addition to Offer

Bid refers to the cost of a part which a prospective buyer is ready to pay for item scrip. Offer is the cost at which a part is offered for a sale on stock exchange.

11. Brokerage

Brokerage agency the committee charged past times a broker for purchase or sale of securities done through him. The maximum brokerage chargeable equally stipulated past times SEBI is at nowadays 2.5 % of the merchandise value.

12. BOLT

Bombay Stock Exchange has introduced BOLT. That is, BSE - On - Line - Trading - System for listed securities. Trading is guild driven equally quote driver organization is discontinued. For this role BSE classified the listed securities into v categories. Viz. A, B1, B2, F, G in addition to Z. Out of these A, B1 in addition to B2 groups stand upward for equity segment. Group F represents securities which stimulate got fixed income, 'G' grouping represents Government Securities whereas 'Z' represents those companies which failed to comply alongside listing norms or failed to redress investors' complaints or failed to comply alongside depository requirements. Trading of securities of listed companies of other exchanges is likewise permitted in addition to these securities are categorised inwards 'Permitted Securities.'

13. 'Badla' or Carry Forward Trading

Carry Forward or 'Badla' refers to the trading inwards which the short town of a transaction is postponed to the side past times side short town menstruum on payment of or so charges past times way of involvement known equally Badla Charges. Carryover or Badla is a facility given to the speculator past times the other political party to send frontwards the transaction from 1 short town menstruum to another. The scrips inwards specified categories (i.e. Group A) lonely could last carried forward. Badla charges vary from menstruum to menstruum in addition to are fixed fortnightly.

14. Bulls

Bulls are those brokers of stock telephone substitution who are rattling optimistic of the ascension inwards prices of securities. Hence, they become on buying shares inwards expectation of selling them at higher prices later. Thus, inwards a bull marketplace position in that location volition last excess of purchase over sales. Bulls are likewise called 'Tejiwallas'.

15. Bears

Bears are those fellow member brokers of stock telephone substitution who are ever pessimistic inwards approach. They facial expression a autumn inwards prices of securities. Hence, they become on selling securities. They are likewise called Mandiwallas. Influenza A virus subtype H5N1 Bearish marketplace position refers to a marketplace position where prices of shares are falling continuously where in that location are excess of sales over purchases.

16. Blank transfers

Blank transfers facilitate speculative activities through badla transactions. If a seller (or transferer) of safety only signs the transfer shape without specifying the advert of buyer (or transferee), it is called a blank transfer. Badla transactions involve temporary purchases in addition to sales of securities. If they stimulate got to last registered, it involves lot of inconveniences due to registration fees, postage stamp duty, etc. Hence, to avoid such inconveniences blank transfers are increasingly used to carryover the transaction.

17. Circuit breakers

Its a machinery past times which Stock Exchanges temporarily suspend the trading inwards a safety when its prices are volatile in addition to tend to breach the cost band.

18. Clearing

Clearing is a procedure through which all transactions betwixt members of stock telephone substitution are settled through multilateral netting.

19. Company objection

For transfer of a safety a transferer sends a scrip certificate along alongside the transfer deed to the company. In or so cases the society refuses the registration of transfer on concern human relationship of signature difference, or fake, forged or stolen shares. In such cases the society returns the documents sent along alongside a missive of the alphabet which is termed equally a 'company objection'.

20. Cornering

It refers to the procedure of asset entire furnish of a item safety past times an private or a grouping of individuals alongside a reckon to dictating terms to the curt sellers in addition to earning to a greater extent than profits.

21. Clearing Settlement

Under this method, the transactions are cleared in addition to settled through the clearing house. Usually those securities which are ofttimes traded in addition to are usually inwards need are cleared through the clearing house.

22. Client brokers

These brokers do elementary braking concern past times acting equally intermediaries betwixt the buyers in addition to sellers in addition to they earn exclusively brokerage for their services rendered to the clients.

23. Cum-bonus

The shares are called cum-bonus when a purchaser is entitled to have the electrical current bonus declared past times company.

24. Cum-rights

The part is described equally cum-rights when a purchaser is entitled to have the current-rights shares declared past times the company.

25. Day order

A twenty-four hr menstruum order, equally the advert suggests, is an guild which is valid for the twenty-four hr menstruum on which it is entered. If the guild cannot last executed during the day, it gets cancelled automatically.

26. Discretionary order

It is an guild placed past times a customer to purchase or sell shares at whatever cost the broker thinks reasonable. This is possible exclusively when the customer has consummate faith on the broker.

27. Ex-bonus

The part is described equally ex-bonus when a purchaser is non entitled to have the electrical current bonus, the right to which remains alongside the seller.

28. Ex-rights

The part is described equally ex-rights when a purchaser is non entitled to have the electrical current rights, the right of which remains alongside the seller.

29. Forward trading

Forward trading refers to trading where contracts traded today are settled at or so time to come appointment at prices decided today.

30. Good-bad delivery

A part certificate together alongside its transfer shape which meets all the requirements of championship transfer from seller to buyer is called skillful delivery inwards the market.

Delivery of a part certificate, together alongside a deed to transfer, which does non encounter requirements of championship transfer from seller to buyer is called a bad delivery inwards the market.

31. Hand Delivery Settlement

Under this method, the delivery of securities in addition to payment are affected inside the fourth dimension stipulated inwards the understanding or inside fourteen days from the appointment of contract whichever is earlier. Most of the transactions are conducted on the ground of paw delivery settlements.

32. Insider Trading

It agency trading inwards a company's shares past times a individual who is associated alongside that company. As a final result of his association he has a clandestine cost sensitive data close the society such equally expansion plans, fiscal results, takeover bid, bonus or right number etc. He tries to exploit that data in addition to maximise his turn a profit through trading inwards the scrip of that company. It is a criminal offense in addition to hence prohibited past times stock exchanges.

33. Jumbo certificate

A jumbo part certificate is a unmarried composite part certificate issued past times consolidating-a large number of marketplace position lots.

34. Jobbers

A jobber is a professional person independent broker who deals inwards securities on his ain behalf. Like brokers he does non purchase or sell securities on behalf of a customer for a commission. Instead he purchases the securities inwards his ain advert in addition to sells them out when the prices of those securities increment in addition to thereby earn a profit. He is similar a stockist of safety of dissimilar companies. He buys securities equally a owner, keeps them for a rattling curt menstruum in addition to sells them for turn a profit known equally 'jobbers turn'. He plant for a turn a profit in addition to non for a commission.

35. Lame ducks

Lame ducks are behave brokers (expecting decline inwards prices) who ultimately sell the securities ultimately at a loss past times making incorrect moves. They lose inwards marketplace position due to the incorrect prediction that part prices volition decline but inwards reality they increase. Generally, they contract to sell securities which they do non posses, therefore, they are caught inwards a incorrect foot.

36. Limit order

It is an guild for the purchase or sale of a scrip at a ready cost specified past times the client. e.g. "Sell 100 TISCO shares @ Rs. 280".

37. Market Lot

Market lot refers to the minimum number of shares of a item safety that must last transacted on the exchange. Market lot may last 10 shares, 20 shares, 50 shares or 100 shares. Multiples of the marketplace position lot may likewise last transacted. In demat scrips the marketplace position lot is 1 share.

38. No-delivery period

Whenever a majority closure or tape appointment is announced past times a company, the Exchange sets a no-delivery menstruum for that security. During this period, trading is permitted inwards that security. However, these trades are settled exclusively after the no-delivery menstruum is over. This is done to ensure that investor's entitlement for corporate benefits is clearly determined.

39. Odd lot

A number of shares that are less than the marketplace position lot are known equally strange lots. Under the scrip based delivery system, these shares are ordinarily traded at a discount to the prevailing cost for the marketable lot.

40. Order-driven trading

It is a trading initiated past times purchase I sell orders, from investors / brokers.

41. Over-the Counter trading

Trading inwards those stocks which are non listed on a stock exchange.

42. Open order

It is an guild to purchase or sell a safety received from a customer without fixing whatsoever fourth dimension bound or cost bound on the execution of the order. It is similar to discretionary order.

43. Pay-in

Pay-in twenty-four hr menstruum is the designated twenty-four hr menstruum on which the securities or funds are delivered / paid inwards past times the members to the clearing family of the Exchange.

44. Pay-out

Pay-out is the designated twenty-four hr menstruum on which securities in addition to funds are delivered I paid out to the members past times the clearing family of the Exchange.

45. Price band

The daily / weekly cost limits inside which cost of a safety is allowed to ascension or fall.

46. Price rigging (or Rigging the market)

When a individual or persons acting inwards concert alongside each other collude to artificially increment or decrease the cost of a security, that procedure is called cost rigging or rigging the market. It is an undesirable activity since it prevents the gratis interplay of need in addition to supply. Stock exchanges in addition to SEBI endeavour to discourage such practice.

47. Quote-driven trading

Trading where brokers / marketplace position makers give purchase I sell quote for a scrip simultaneously.

48. Record date

Record appointment is the appointment on which the beneficial ownership of an investor is entered into the register of members. Such a fellow member is entitled to larn all the corporate benefits.

49. Rematerialisation of shares

It is the procedure through which shares held inwards electronic shape inwards depository are converted into physical form.

50. Screen based trading

When buying / selling of securities is done using computers in addition to matching of trades is done past times a stock telephone substitution computer.

51. Settlement

It refers to the scrip-wise netting of trades past times a broker after the trading menstruum is over.

52. Settlement guarantee

Settlement guarantee is the guarantee provided past times the clearing company for short town of all trades fifty-fifty if a political party defaults to deliver securities or pay cash.

53. Splitting /Consolidation

The procedure of splitting shares that stimulate got a high human face upward value into shares of a lower human face upward value is known equally splitting. The contrary procedure of combining shares that stimulate got a depression human face upward value into 1 part of higher value is known equally consolidation.

54. Spot trading

Trading past times delivery of shares in addition to payment for the same on the appointment of purchase or on the side past times side day.

55. Stop transfer

It is an didactics given past times a registered holder of shares to the society to halt the transfer of shares inwards his advert equally a final result of theft, misplacement, loss of part certificates.

56. Stags

Stags are those members inwards part marketplace position who neither purchase nor sell securities inwards stock exchange. They only apply for subscription to novel issues expecting to sell them at a higher cost afterwards when the issues are quoted on stock exchange. Generally, stags purchase novel issues in addition to sell them on resources allotment or fifty-fifty before resources allotment for a profit. Since they deed fast they are called stags - a fast runner.

57. Spot delivery settlement

These transactions are to last settled past times delivery in addition to payment on the appointment of contract or on the side past times side day.

58. Special delivery

Delivery in addition to payment made anytime exceeding fourteen days, but non exceeding 2 months, next the appointment of the contract equally may last stipulated when entering into the grapple in addition to permitted past times the Governing Board or the President.

59. Stop Loss Order

It is an guild past times a customer to sell equally presently equally the prices autumn upto a item degree or to purchase when the cost rises upward to a specified level. This is mainly to protect the clients against a heavy autumn or ascension inwards prices so that they may non endure to a greater extent than than the pre-specified amount.

60. Trade guarantee

Trade guarantee is the guarantee provided past times the clearing company for all trades that are executed on the exchange. In contrast, at the short town guarantee, guarantees the short town of merchandise after multilateral netting.

61. Transfer deed

A transfer deed is a shape that is used for effecting transfer of shares or debentures in addition to is valid for a specified period. It should last sent, to the society along alongside the part certificate for registering the transfer. The transfer deed must last duly stamped in addition to signed past times or on behalf of the transferor in addition to transferee in addition to consummate inwards all respects.

62. Wash Sales

Wash sales is a sort of fictitious transaction through which a speculator is able to reap huge turn a profit past times creating a misleading motion painting inwards the market. He makes fictitious sale of a safety in addition to so makes a purchase of the same safety at higher cost through or so other broker. Thus, he creates a misleading reckon inwards the marketplace position equally if the cost of a safety inwards query is rising. As a final result of such mistaken opinion, when the cost of the safety genuinely rises the speculator sells it to earn a skillful profit. Wash sale is a sort of cheating hence stock exchanges impose severe penalization on such sales.

63. Wolves

These are the brokers who are fast in addition to smart speculators. They speedily perceive changes inwards the trends inwards the marketplace position in addition to merchandise fast to brand profit. They are non by in addition to large caught inwards the incorrect foot.