Term
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Definition
| Partial ownership in a company |
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Term
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Definition
| Selling stock borrowed from a broker, then repaying it a later time |
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Term
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Definition
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Term
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Definition
| The right to buy or sell 100 shares of the stock |
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Term
| What are the 4 specific portions of an option? |
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Definition
1. A specific stock or other security called the “underlying” security
2. It is a right to buy or sell, and every option controls 100 shares of stock
3. A specific strike price is the fixed price at which the option can be exercised
4. Every option has a fixed expiration date. After that date, the option is worthles |
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Term
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Definition
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Term
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Definition
| The right to sell a stock |
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Term
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Definition
| The rate of change of option price in reference to respective stock price |
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Term
| How do you calculate the value of a call option? |
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Definition
| The difference between the market price of the stock and the strike price of the option, or zero, whichever one is greater |
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Term
| Can you give an example of delta? |
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Definition
Suppose a call option has a strike price of $50.
If the underlying stock price is $75, the call’s intrinsic value is $25
If the underlying stock price is $25, the calls intrinsic value is $0 |
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Term
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Definition
| Leverage: Playing a game that’s typically reserved for the big wigs. Since we have the stock market, we can play the game up to the point where we run out of the initial investment |
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Term
| What is fundamental analysis? |
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Definition
| Reports based on quarterly earnings, IPO’s and other statements |
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Term
| What is technical analysis |
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Definition
| Analysis going strictly off of the chart and their patterns. They reveal the populations emotion towards the stock |
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Term
| What are the 3 Main trends when looking at a technical analysis chart |
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Definition
1. Indecisive
2. Reversal
3. Continuation |
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Term
| What is support in a technical analysis graph? |
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Definition
| A floor that we expect the graph to bounce off of |
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Term
| What is resistance in a technical analysis graph? |
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Definition
| A ceiling that is difficult for the chart to break through |
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Term
| How ones a head and shoulders pattern look? |
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Definition
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Term
| What would you expect at the end of a head and shoulders pattern? |
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Definition
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Term
| What does a triple bottom pattern look like? |
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Definition
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Term
| What does a cup and handle pattern look like? |
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Definition
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Term
| What is an uptrend characterized by? |
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Definition
| Higher high and Higher lows |
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Term
| What is a downtrend characterized by? |
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Definition
| Lower highs and Lower lows |
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Term
| What does a flag pattern look like? |
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Definition
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