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Hyper Stocks Stock Market Cheat Sheet

Stock Trading Terms

  1. Stock: A share in the ownership of a company, representing a claim on its assets and earnings.
  2. Equity: Another term for stock, representing ownership in a company.
  3. Ticker Symbol: The unique abbreviation used to identify a publicly traded company on a stock exchange (e.g., AAPL for Apple).
  4. Exchange: A marketplace where securities, commodities, derivatives, and other financial instruments are traded (e.g., NYSE, NASDAQ).
  5. Market Order: An order to buy or sell a stock immediately at the best available price.
  6. Limit Order: An order to buy or sell a stock at a specified price or better.
  7. Stop Loss: An order to sell a stock when it reaches a certain price, used to limit potential losses.
  8. Bull Market: A market condition where prices are rising or expected to rise.
  9. Bear Market: A market condition where prices are falling or expected to fall.
  10. Volume: The total number of shares traded for a particular stock or in the entire market during a specific period.
  11. Dividend: A portion of a company’s earnings distributed to shareholders, typically in cash or additional shares.
  12. Earnings Per Share (EPS): A company's profit divided by the number of outstanding shares.
  13. Price-to-Earnings (P/E) Ratio: A valuation metric calculated as the stock price divided by its EPS.
  14. Market Capitalization (Market Cap): The total market value of a company's outstanding shares, calculated as stock price multiplied by the total number of shares.
  15. IPO (Initial Public Offering): The first sale of a company’s stock to the public.
  16. Volatility: A measure of how much a stock’s price fluctuates over a period of time.
  17. Sector: A group of stocks representing companies in similar industries (e.g., technology, healthcare).

Options Trading Terms

  1. Option: A financial contract giving the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified price within a certain time frame.
  2. Call Option: A contract that gives the holder the right to buy the underlying asset at a specific price before the expiration date.
  3. Put Option: A contract that gives the holder the right to sell the underlying asset at a specific price before the expiration date.
  4. Strike Price: The price at which the holder of an option can buy (call) or sell (put) the underlying asset.
  5. Premium: The price paid by the buyer to the seller for an options contract.
  6. Expiration Date: The date on which an options contract becomes void and the right to exercise no longer exists.
  7. In the Money (ITM): A call option where the stock price is above the strike price or a put option where the stock price is below the strike price.
  8. Out of the Money (OTM): A call option where the stock price is below the strike price or a put option where the stock price is above the strike price.
  9. At the Money (ATM): An options contract where the stock price is equal to the strike price.
  10. Implied Volatility (IV): A metric that estimates the future volatility of the underlying asset’s price, affecting the option’s premium.
  11. Delta: Measures the sensitivity of an option’s price to changes in the price of the underlying asset.
  12. Theta: Measures the rate at which an option’s value decreases as it approaches its expiration date (time decay).
  13. Covered Call: A strategy where the investor owns the underlying stock and sells a call option on the same stock.
  14. Protective Put: A strategy where the investor buys a put option to protect against potential losses in the underlying stock.
  15. LEAPS (Long-Term Equity Anticipation Securities): Options with expiration dates longer than one year.
  16. Assignment: When the writer of an option is obligated to fulfill the terms of the contract (sell or buy the underlying asset).

General Trading Concepts

  1. Bid Price: The highest price a buyer is willing to pay for a security.
  2. Ask Price: The lowest price a seller is willing to accept for a security.
  3. Spread: The difference between the bid and ask prices.
  4. Liquidity: The ease with which a security can be bought or sold without affecting its price.
  5. Margin: Borrowing money from a broker to buy securities, requiring the investor to pay a portion of the purchase price.
  6. Leverage: Using borrowed funds or derivatives to increase potential returns.
  7. Short Selling: Selling a security that the investor does not own, betting that its price will decrease.
  8. Hedging: Using financial instruments to reduce potential losses in an investment.
  9. Arbitrage: Simultaneously buying and selling the same asset in different markets to exploit price differences.
  10. Stop-Limit Order: An order that becomes a limit order once the stock reaches a specified price.