Glossary of Investment Terms

Bear
Someone who believes the market will fall. A market that is falling is often referred to as a "bear market."
Bull
Someone who believe the market will rise. A market that is rising is often referred to as a "bull market."
Growth stock
Stock in a company that is projected to have rapidly increasing revenues and profits.
Limit order
An order to buy or sell a stock at a specified or better price. For instance, while the current bid for a stock may be $10.50/share, an investor may put in a limit order to purchase the stock at $9.00/share, hoping that the price will fall to or below that level.
Long
Refers to a position where a stock has been purchased (usually to be held). This is often referred to as "going long." Being long in a stock means that you believe that its value will rise.
Option
The right to purchase or sell a stock (or commodity) at a fixed price within a specific time frame. An option to purchase is called a "call," while an option to sell is called a "put."
Short
Refers to a position where a stock has been borrowed from a brokerage and then sold, in hopes of being able to repurchase (or cover) the stock at a lower price. The profit (or loss) is the difference between the price at which the stock was borrowed and the price at which it was repurchased (or covered). This is often referred to as "going short."
Stop Order
An order to purchase a stock at a price above the current market price or to sell a stock at a price below the current market price. A "stop buy," for instance, is often used to limit losses from a short position, while a "stop sell" may be used to limit losses from a long position.

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