What's in a Name

Oh what we learn when we read...

Dow Jones Industrial Average is also known as the Wilshire 5000.

S&P 500 stands for 'Standard and Poor' and was originally called the Composite Index with only 90 stocks.

P/E is the Price of a stock compared to its Earnings.

Market Value or market capitalization or market cap is the product of the shares outstanding for a company and the price per share.

Investor Return is the change in the price per share plus the dividend.

IPO is Initial Public Offering.

Offer Price is the price at which an IPO's stocks are valued prior to being floated to the public. Very few investors are privy to these prices.

Trading Price is the price most average investors end up paying for a stock on an IPO's first day of trading, which can easily be double the offer price, if not higher.

Capex is capital expenditures; many erroneously believe these drive profits... they do not.

TFSA stands for Tax-Free Savings Account is a new tax-shelter tool for Canadians coming in 2009.

Margin Borrowing is getting a loan to purchase stock you can't pay for.

Short Selling is the backward practice of selling stock first, then buying it later. If prices fall after the sale, there is a profit.

Stock Lending is like renting out your stock for use; you retain ownership and can call the loan at any time.