STOCK MARKET GLOSSARY

A Latin phrase meaning "known ahead of time" or more precisely, known without any empirical evidence or experience. The classical example would be a mathematical... read more

The A2X is a South African stock exchange which competes directly with the Johannesburg Securities Exchange (JSE). It is currently operating only... read more

An option contract which is not enforced because it is out-of-the-money. Options confer a right to either buy (call) or sell (put) a certain quantity... read more

A rare candlestick pattern which can indicate either a new bullish or a new bearish trend. A bullish abandoned baby pattern occurs where there... read more

Elliott wave terminology for a three-wave countertrend (or downtrend) price movement in an Elliott cycle. Wave "a" is the first down-wave... read more

An income or expense which may be part of the company's normal business but which is abnormal in amount. So, an unusually high expense or... read more

Any normal expense or income which has been included in the calculation of a company's gross profit and which is a part of its normal... read more

An offering of new shares in the short term which is non-promoted to institutional investors in order to raise capital. An accelerated bookbuild... read more

Where a bank "accepts" some kind of debt instrument usually at a discount. Debt instruments are basically IOU's written by one organisation... read more

The date on which the right acquired by a shareholder, as a result of a rights issue, must be exercised. Listed companies often raise... read more

The extension of credit by the Reserve Bank to commercial banks. The central bank acts as a banker to the commercial banks, lending them money... read more

A set of conventions for recording and gathering financial transactions in an organisation. The academic discipline which is accountancy has established a set... read more

Accountants are notoriously conservative people. Conservatism applies to incomes, expenses, liabilities and assets of unknown amounts.... read more

These are conventions developed by the accounting profession to ensure that the financial statements display a clear and accurate picture of the progress... read more

The period of time over which the financial affairs of a company are being accounted for in the financial statements. The matching principle... read more

A policy established by the board of directors for the allocation of transaction entries into the books of account. For public, listed companies,... read more

The books of a business. These are the books of first entry and other working papers used by the accountants to draw up a company's financial statements.... read more

Amounts owing to the company's creditors in the balance sheet. These appear under current liabilities. These amounts are owed by the... read more

Amounts owing to the company, usually by customers who have bought products on credit. This is another term for "debtors" and appears in the balance... read more

A balance sheet item that consists of an expense or income which has not yet been paid or received. So, for example, if a company owes rent... read more

When the volumes traded in a share start to pick up while the share price moves sideways or upwards, this is known as an "accumulation... read more

An accounting ratio used to determine whether a company's current assets excluding its stock (i.e. just its debtors' book... read more

The ratio os a company's turnover to its assets. The ratio is calculated by dividing a company's total sales by the average... read more

This is when one company acquires more than 50% of the shares of another or obtains a controlling interest in its shares. The company acquiring the... read more

A completely unpredictable event or "black swan" (see "The Black Swan" by Nasssim Talbert) event, usually but not always occurring as a result of some natural... read more

An activist short seller is an investor who takes a short position in a listed company and then publicly attacks them to... read more

(1) Refers to actual physical commodities, as distinguished from the futures on those commodities. So, for example, there is a "spot... read more

Most stock market indexes, except for the very simplest are calculated by actuaries. This is because the calculation must take into account... read more

An actuary is an expert in mathematics and statistics who is capable of calculating the probability of key commercial events or of calculating the changing weightings... read more

An actuary is an expert in mathematics and statistics who is capable of calculating the probability of key commercial events or of calculating the changing weightings... read more

The first person to study and write about economics. Adam Smith (1723 - 1790) is regarded as the father of the discipline of economics. His book "An Inquiry... read more

This is also known as "adjusted shareholders' equity" and refers to the total amount of money which the shareholders have in a business - the adjustment made is... read more

Prices of certain products in South Africa are determined, not by the forces of supply and demand, but by various government departments and institutions.... read more

Certificates that are issued by a bank of US origin and traded in the U.S. as domestic shares. The certificates represent the foreign securities that the... read more

A breadth indicator which gives a ratio of the volumes of shares with rising prices to shares with falling prices, developed... read more

This is a refinement of the net advance/decline line (Net A/D), calculated by dividing the difference between the total number of shares up and the... read more

The loss attributable to price movement against the position in any one trade from the time that the trade began. So, for example, if XYZ shares were bought for... read more

An audit opinion which indicates that the company's financial statements do not accurately reflect the company's performance during the accounting period or its... read more

Investment advice has become a big industry in South Africa and world-wide. Lay people with surplus cash obviously wish to generate a return which... read more

A transaction defined in the Companies Act (71 of 2008) as one which will result in a change in the control of the company. This could be... read more

A division of the JSE which was abandoned in June 2012. The Africa board was originally supposed to attract companies from the rest of Africa to list... read more

An American Act which allows certain African countries to export to America duty free. Altogether, 37 countries in Africa benefit from this piece of American... read more

A stock exchange located somewhere in Africa. The largest stock exchange in Africa... read more

An economic index of activity in the construction sector prepared and produced by the economist Roelof Botha, on behalf of Afrimat, every quarter.... read more

The profit of the company after taxation has been deducted. This figure is shown in the income statement and is used for calculating... read more

The profit of the company after taxation has been deducted. This figure is shown in the income statement and is used for calculating... read more

The profit of the company after taxation has been deducted. This figure is shown in the income statement and is used for calculating... read more

Twice every trading day members of the London Gold Market Fixing meet on a conference call to decide the gold price - at 10.30am (the morning fix)... read more

The Income Tax Act (58 of 1962) offers three rebates - primary, secondary and tertiary. In the tax year ending on 28th February 2021, the primary... read more

A natural or juristic person who acts on behalf of another such person in a commercial transaction. When a stockbroker acts on behalf of his/her... read more

This is a meeting of the shareholders of a company, which is required in terms of section 61 of the Companies Act (71 of 2008). The AGM must... read more

An American Act which allows certain African countries to export to America duty free. Altogether, 37 countries in Africa benefit from this piece of American... read more

A division of the JSE that runs spot markets and derivatives markets in agricultural grain products. The main products are soya... read more

An industry engaged in the production of a wide variety of products, both animal and vegetable, by means of cultivating the land. This industry is a major... read more

A part of the London Stock Exchange which caters for smaller companies - in a similar way to the JSE's Alt-X. Some South African companies... read more

The Chairman of the Federal Reserve Bank of America (Fed) from 1987 to 2006. Alan Greenspan is notable because he ushered in the idea of stimulating... read more

A committee of senior executives in a large company that manage the cash flow of the business to ensure that there is sufficient liquidity... read more

Trading automatically, usually without human intervention, through a computer system that is directly connected to an organised exchange. This type of trading... read more

Trading automatically, usually without human intervention, through a computer system that is directly connected to an organised exchange. This type of trading... read more

All stock exchanges have indexes which provide averages of the prices of their listed shares. These averages are normally... read more

The number of shares actually sold to a person who has applied to participate in a new issue. Where the shares of an initial public offer (IPO) are... read more

Formerly a letter which was issued to inform someone who had applied for shares, either in a rights issue or a public issue, that they had been apportioned... read more

Premium that an investment portfolio earns above a given point of reference; a measure of stock performance independent of the market. Unit... read more

The Alt-X is part of the JSE. It is a board which is available to those companies which cannot qualify to list on the "main board".... read more

The Companies Act (71 of 2008) distinguishes between alterable and unalterable provisions. An alterable provision is one which may be changed to suit the... read more

An individual appointed to take the place of existing director in certain specific circumstances, or at times when he is not available. The Companies Act... read more

This is an asset which is not traded on any organised exchange in a conventional manner. So, for example, properties are alternative assets, but the shares... read more

The Alt-X is part of the JSE. It is a board which is available to those companies which cannot qualify to list on the "main board".... read more

A part of the London Stock Exchange which caters for smaller companies - in a similar way to the JSE's Alt-X. Some South African companies... read more

A silvery white, soft, non-magnetic and ductile base metal. It is noted for it's low density and ability to resist corrosion. It is used in the transportation... read more

This occurs where two or more companies come under the control of one, whose shareholders then become the shareholders of the companies that were... read more

Certificates that are issued by a bank of US origin and traded in the U.S. as domestic shares. The certificates represent the foreign securities that the... read more

An options contract that allows the holder to exercise the option at any time up to and on the expiration date. This is as opposed to a European... read more

Originally an overflow of companies that were too small to list on the New York Stock Exchange, the "Amex" or "the curb" as... read more

Originally an overflow of companies that were too small to list on the New York Stock Exchange, the "Amex" or "the curb" as... read more

Accounting method in which an asset's cost is spread out over a period of time. For example, a vehicle costing R100 000 might be amortised or "depreciated"... read more

Candlestick formation. An exceptional exhaustion pattern (meaning "gap filling") composed of five candles. The anaume occurs when the gap... read more

This is a technical analysis technique (also known as "Andrews' pitchfork" because of its shape) for establishing upper and lower support and resistance... read more

The historical earnings change between the most recently reported fiscal year's earnings and the preceding or a forecast. Paragraph 3.4(b) of the... read more

Sometimes known as an Annual Report or just the "financial statements", this is a document required by the Companies Act (71 of 2008) to be... read more

This is a meeting of the shareholders of a company, which is required in terms of section 61 of the Companies Act (71 of 2008). The AGM must... read more

The percentage that the company earned from gross sales (also called "turnover") for the most recently reported fiscal year. In other... read more

Sometimes known as an Annual Report or just the "financial statements", this is a document required by the Companies Act (71 of 2008) to be... read more

Every company is required in terms of section 33 of the Companies Act (71 of 2008) to submit a return to the Companies and Intellectual Property... read more

The percentage change in sales (turnover) between the most recently reported financial year and the preceding. You should note that unless... read more

The process of adjusting performance or return which has been made over a period of less than or more than a year so that it can be compared with the annual... read more

An income which comes in regularly, usually as the result of a contractual obligation and a pre-arranged bank debit order. When analysing a share,... read more

APEC is a group of 21 countries formed in 1989 to encourage trade among the Pacific rim countries. The countries in APEC are: United States; Australia; Brunei... read more

An investor who applies for shares in a company's new issue. Sometimes, if the company is seen to be a very good investment,... read more

This is a form completed by someone who wishes to buy shares as part of a primary market offer. When companies list on the stock exchange,... read more

Where a minority shareholder does not agree with a fundamental transaction (i.e. one which will change the control of the company,... read more

Simultaneous trading in assets, currency or bills of exchange in different international markets, to take advantage of the different rates of return... read more

Also known as TRading INdex (TRIN): An advance/decline stock market indicator. A reading of less than 1.0 indicates bullish demand, while greater... read more

Richard Arms was an American technical analyst and wrote books on technical analysis. He was most famous for his book "The Arms Index", but wrote... read more

Prior to the Companies Act (71 of 2008), this was a document, drawn up by the subscribers of a company at its inception, which governed the... read more

A formation, which is part of an uptrend, where the share price forms a triangle bounded by a horizontal resistance line at the top... read more

APEC is a group of 21 countries formed in 1989 to encourage trade among the Pacific rim countries. The countries in APEC are: United States; Australia; Brunei... read more

The price at which an investor who is holding a share (or other security) is willing to sell. Also referred to as the "offer price." The JSE's... read more

A loss made by a business which has been accepted as valid by the Receiver of Revenue. Such assessed losses can be carried forward and off-set against... read more

An item on the balance sheet that means the possessions of a company, an organisation or an individual. Assets can be tangible (e.g. a vehicle),... read more

A strong asset backing indicates that a company has large resources of assets. These may reside in a parent company, or they may belong to... read more

A concept which came from the previous Companies Act and its doctrine of Capital Preservation. Money raised by a company as a result of issuing shares... read more

An asset bubble is a period where the price of a particular asset reaches unsustainable levels due to investor enthusiasm. Over the centuries there... read more

A category of assets which all have similar characteristics. Thus shares, property, commodities, and fixed interest investments bonds... read more

A committee of senior executives in a large company that manage the cash flow of the business to ensure that there is sufficient liquidity... read more

The management of listed or unlisted assets (equities, options etc.) by a "fund manager". Asset management is a very well-developed... read more

The JSE is dominated by institutional investors which account for as much as 90% of all trades. These institutions are pension funds, insurance... read more

An asset market is the spot market for a particular asset. Thus, the gold market or the oil market or the market for pork bellies... read more

An asset which will hold its value irrespective of any developments in the economy. Investors are primarily concerned with achieving a balance... read more

This occurs where a company is purchased because the market price of its shares is less than the value of its assets. Assets are then... read more

The ratio of a company's sales or turnover to the average value of assets held over the accounting period. The objective... read more

In terms of International Financial Standards Reporting (IFRS) 5, when a company's board decides that a particular asset or group of assets... read more

When a trader sells short an option, he may be assigned in the event that the purchaser exercises the option. A trader with a short call... read more

Any earthly cycle that has been scientifically related to the physics of the planetary system. Some technical analysts say that share market cycles have a correlation... read more

Formed in 1987 with the amalgamation of the six state exchanges, the ASX offers organised exchanges in equities, derivatives, fixed interest... read more

An instruction given to a stockbroker by his clients to sell or buy "at best" would give the broker freedom to purchase or sell the shares concerned... read more

The term used to describe money placed, usually with a bank, which can be drawn immediately - as opposed to money which is tied up for a period of time.... read more

An order to be transacted immediately against the best opposite order in the book at the time of making such entry.

ATS (see SETS). In 1996 the open outcry trading floor was closed on 7 June and replaced by an order driven, centralised, automated trading system known... read more

That part of a company's profit which is "attributable" to the ordinary shareholders. In other words, after the normal operating expenses... read more

That part of a company's profit which is "attributable" to the ordinary shareholders. In other words, after the normal operating expenses... read more

All companies listed on the JSE have to produce at least two sets of audited financial statements each financial year - interim... read more

This is an audit opinion given when the auditor cannot obtain sufficient documents and information to support their opinion. This can happen because management... read more

An audit opinion where the auditor refuses to give an opinion because he feels that he can place no reliance on the underlying financial accounts.... read more

A person who is qualified to conduct an audit on a company or other organisation. Auditors are either internal auditors working for the company that... read more

The auditor-general of South Africa (AGSA) is an appointment in terms of Chapter 9 of the constitution (section 181). The AGSA is tasked with conducting regular... read more

A part of the annual financial statements required by the Companies Act where the auditors state that they have examined the financials and... read more

Formed in 1987 with the amalgamation of the six state exchanges, the ASX offers organised exchanges in equities, derivatives, fixed interest... read more

The number of shares in each class which a company is authorised to issue to the public or in exchange for assets. The authorised shares must... read more

The number of shares in each class which a company is authorised to issue to the public or in exchange for assets. The authorised shares must... read more

The number of shares in each class which a company is authorised to issue to the public or in exchange for assets. The authorised shares must... read more

A stainless-steel cylinder containing a honeycomb coated with a solution of rhodium, platinum and palladium. It is installed on a vehicle's exhaust system to convert... read more

ATS (see SETS). In 1996 the open outcry trading floor was closed on 7 June and replaced by an order driven, centralised, automated trading system known... read more

A linear stochastic model forecasting methodology described by Box and Jenkins in their book "Time Series Analysis, Forecasting and Control".

The mean of a set of numbers. Averages are used extensively in the share market for the determination of market indexes and economic... read more

A method of valuing shares in a portfolio at the average of what they cost. For example, if 100 shares are bought for 100 cents each and then... read more

Indicator developed by J. Welles Wilder to measure market trend intensity. Average Directional Movement Index Technical Indicator (ADX) helps... read more

Certain statistics for listed companies on the JSE are given in the form of "per share" data - such as earnings per share and... read more

A moving average of the true range. Developed by J. Welles Wilder and introduced in his book, "New Concepts in Technical Trading Systems" (1978),... read more

Taking advantages of those parts of the Income Tax Act (58 of 1962) which are not well defined to get out of paying tax. This practice runs the risk that... read more

A second tier of share capital which has different risk and return characteristics from the "A" ordinary shares. For example, following... read more

A document, also known as a "bill of exchange" in terms of which a commercial bank accepts that it will pay the holder within a specified period,... read more

The annualised interest rate at which financial institutions (typically banks) accept or discount bills of exchange. Often in business... read more

Those futures delivery months with expiration or delivery dates furthest into the future; in other words, futures delivery months other than the spot month,... read more

This is the department in a stockbroking firm, which deals with settlement procedures, such as controlling electronic settlements on behalf of clients... read more

The ratio of a person's mortgage payments plus any other loan repayments they have to his/her gross monthly income. This ratio is sometimes used by banks... read more

A strategy is tested or optimized on historical data and then the strategy is applied to new data to see if the results are consistent. For example, you may believe... read more

A technical analysis term meaning a period of "backing and filling" where a share's price moves up and down within a tight range... read more

An economics concept used to describe a phenomenon which occurs in the labour market. As employees are paid more per hour they will tend to work... read more

The process whereby bacteria oxidise mined ore to assist in the extraction of valuable minerals. The process has been patented by a South African company... read more

This is a debt which cannot be recovered - thus forcing the company to write it off against profits. Most companies make provision for bad... read more

A bail out occurs where the government of a country or a large company injects funds to save a commercial organisation (usually a bank) from failure.... read more

A bail out occurs where the government of a country or a large company injects funds to save a commercial organisation (usually a bank) from failure.... read more

The combined net position on the capital account and current account of the country. The current account indicates whether South Africa is spending... read more

This forms part of the balance of payments calculation, but refers only to the difference between the value of exports offset against imports.... read more

A list of all balances taken from a company's ledger after incomes and expenses have been offset to arrive at a profit or loss.... read more

A mutual fund that seeks a return that is a combination of capital appreciation and current income, generally by building a portfolio of bonds,... read more

The combined net position on the capital account and current account of the country. The current account indicates whether South Africa is spending... read more

The working together of a bank and an insurance company to exchange their customer lists and thereby increase business. This usually involves a merger,... read more

An oscillator that accentuates only the frequencies in an intermediate range and rejects high and low frequencies. Implemented by first applying a low pass... read more

An organisation registered in terms of the Banks Act (94 of 1990). Commercial banks are deposit-taking institutions that must be registered under the Act to conduct... read more

The BIS is an international bank, owned by central banks, which acts as a bank for bankers. It was formed in 1930 by an agreement between the governments... read more

The central bank of the United Kingdom, located on Threadneedle street. Like all central banks, the BOE is engaged in monetary policy which includes... read more

A detailed project study that can be submitted to a bank or other lending or investing organistaion with the objective of raising funds to complete the... read more

A document, also known as a "bill of exchange" in terms of which a commercial bank accepts that it will pay the holder within a specified period,... read more

An agreement reached by a company with its creditors for the repayment of principal and interest on its outstanding debts. Debt... read more

This refers to where an individual has been unable to pay his debts and has been declared insolvent in terms of the Insolvency Act (24 of 1936).... read more

This index, better known as the "Beti" shows transactions captured at the Bankserv clearing house for cards, automatic teller machines (ATM) and electronic... read more

This is an index of employees' take-home pay from large corporations in South Africa. It is a reflection of the net amount paid into the employee's bank account... read more

A bar chart shows the range of trade for the previous day, week or month by connecting the highest price reached during the day to the lowest... read more

In general terms, the base currency is the currency in which an investor or issuer maintains its books of account. In the FX market,... read more

Most economic statistics are measured over the most recent full year, but updated monthly. This means that the latest month's figures will have as... read more

The minimum electricity use on an electricity grid over a specific time period, like one week. Ideally, this level of electricity should be provided by an energy... read more

A metal which has a low value relative to its weight - as opposed to a precious metal or "noble" metal such as gold, silver or platinum.... read more

The gross salary that is paid to an employee every month. From this are deducted pay-as-you-earn (PAYE), unemployment insurance fund contributions... read more

An agreement between the major countries of the world on the standards to be applied to their major banks so as to minimise the risk of a bank collapse... read more

An agreement between the major countries of the world on the standards to be applied to their major banks so as to minimise the risk of a bank collapse... read more

A company's earnings (profit) divided by the number of ordinary shares usually expressed as a number of cents per share. The earnings per... read more

The measure of yields on bonds, notes and interest rates; one basis point equals 0.01% of yield. For example if the Governor of the... read more

The risk that a hedge contract will not exactly eliminate the risk in the underlying instrument. For example, an investor owns 1000... read more

The Broad Based Black Economic Empowerment Act (53 of 2003) has as its objective the empowerment of black people in South Africa. In order to achieve this... read more

The Baltic Dry Index (BDI) is a composite index calculated by the Baltic exchange in London and made up of the Capesize, Panamax and Supramax averages.... read more

An investor who believes that the market or a particular share is going to decline from its current position. In the share market,... read more

A market where the average of all shares is falling so that each high is lower than the previous high and each low is lower... read more

Where investors who have sold short (made bear sales) attempt to force the price of a share down by making further bear sales... read more

A long downward trend in a share's price, a sector's index, the all-market index or other indicator. Bear trends and... read more

A statistical concept which seeks to reduce a population to its average and then show the positive and negative departures from that average. So,... read more

The processing of raw materials into commodities with greater value. For example, combining iron ore, carbon and other metals to make steel. South... read more

This index, better known as the "Beti" shows transactions captured at the Bankserv clearing house for cards, automatic teller machines (ATM) and electronic... read more

A document, also known as a "bill of exchange" in terms of which a commercial bank accepts that it will pay the holder within a specified period,... read more

The process whereby bacteria oxidise mined ore to assist in the extraction of valuable minerals. The process has been patented by a South African company... read more

Monday, 19^th October 1987 when the New York Stock Exchange fell by almost 23% in a single trading day. On the JSE, the fall happened... read more

This is a completely unpredictable event which has a major impact on the world economy. The best current example is the corona pandemic which caused stock... read more

The largest asset management company in the world with more than $10 trillion under management. The company is American, located in New York but... read more

A very safe share that has a long history of sound management and steady dividends. Examples of such shares are Sasol, Bidvest, First National... read more

The collective term for the directors of a company. Directors, appointed by the shareholders, are tasked with the management of the... read more

In candlestick charting, the body of the candle is drawn between the opening price and the closing price and is coloured... read more

An acquisition which is small relative to the size of the acquiring company. Smaller acquisitions do not impact on the company’s business culture... read more

A long-term debt security with a stated interest rate and fixed due dates, issued by a corporation or a government, when interest and... read more

This is the value at which an asset appears in the books of account of a company. Very often, book values are higher or lower than the... read more

The combined net position on the capital account and current account of the country. The current account indicates whether South Africa is spending... read more

Bracket creep, also called "fiscal drag" occurs because, with inflation, tax payers are pushed into higher tax brackets each year. In normal circumstances... read more

Where a share, index or other instrument's price moves outside the trading range which has constrained it, breaking a trendline... read more

Every year, at the end of February, the Minister of Finance presents the budget to parliament. In the budget he puts forward an estimate of how much money... read more

This is the difference between government revenue and expenditure. Typically, governments spend more than they receive from taxes and other types... read more

Warren Buffett is arguably the most successful investor who has ever lived. He began at the age of 6, selling chewing gum door-to-door in Omaha making a... read more

This term describes an investor who believes that market trends are rising or that a particular share is rising. In the share market... read more

A market where the average of all shares is rising such that each high is higher than the previous high and each low is higher... read more

A situation where bullish investors buy into a security too early, before all the bad news has been published and digested by the market.... read more

A long period of consistently rising share prices, or index levels. Usually such trends last from 2 to 4 years. During a bull trend... read more

The process whereby a company buys its own shares on the JSE in exchange for cash. Share buy-backs are allowed, provided the company can establish... read more

This is when a stockbroking firm has to buy shares (or other securities) on the market to rectify a failed trade. A failed trade... read more

A buying opportunity occurs where a share's price is perceived to be well below its true value. Of course, the true value of a share is a matter... read more

A technical term which refers to a specific event or occurrence which signals to a chartist that it is the correct time to go long (i.e to buy in). The... read more

A member of the South African Institute of Chartered Accountants (SAICA). A chartered accountant (CA) is a person who has passed his bachelors degree (usually... read more

A member of the South African Institute of Chartered Accountants (SAICA). A chartered accountant (CA) is a person who has passed his bachelors degree (usually... read more

The trading system used in the 1980's and 1990's by the Paris Bourse in France. This system gave way to the Nouveau Systeme de Cotation (NSC) in 2000, but the... read more

An account with a bank where the funds on deposit can be withdrawn immediately without notice. Call accounts typically attract a lower rate of interest... read more

The purchased right to buy (call) specified securities at a specified price (strike price) within a specified period (American) or on a specified... read more

This is a securities contract which gives the holder the right to purchase a specified quantity of a company's shares on or before a specific... read more

The average rate of return for the last 36 months divided by the maximum drawdown for the same period. It is usually calculated on a monthly... read more

To abort a pending or working order. Occasionally, a trader may attempt to cancel an order that has already been executed but not yet reported as... read more

This is a variation of standard candle stick charts whereby the width of the candle reflects the volume traded on that particular day.... read more

A candlestick chart where the width of the candles is determined by the volume traded during the day. Obviously this leads to an irregular... read more

An individual display of the high, low, open and close of a specific security over a period of time. A candlestick chart... read more

In candlestick charting, the body of the candle is drawn between the opening price and the closing price and is coloured... read more

A charting method which offers an alternative to the bar chart method of displaying daily weekly or monthly data. This method originated in Japan.... read more

Also called "bonus issues", these do not involve transfer of cash between the company and its members. They occur when a company feels it desirable... read more

Previously the 4 Africa Exchange (4AX), the Cape Town Stock Exchange began operations as a South African stock exchange in March 2017. To differentiate... read more

A ship which is too large to pass through the Suez or Panama Canals and so has move from one ocean to another by going around Cape Town in South Africa or ... read more

An abbreviation for capital expenditure. It is often used when referring to gold mines. It refers to expenditure of a capital nature - in other words, used... read more

Money which is used to supply working capital or to purchase capital goods, which are to be used to generate the income of the company. Capital... read more

An element of the Balance of Payments (BOP) which shows the movement of capital into and out of a country. For example, it shows overseas investors... read more

The Reserve Bank's capital requirement for commercial banks set in terms of their risk weighted assets (RWA). The bank's RWA is made up of... read more

A capital allowance enables a company to deduct a portion of any capital cost which they may have incurred during the tax year for... read more

This is the capital which the private investor has available for investment. This can include the equity in your house, your stock market... read more

The movement of capital into and out of a country as shown in the capital account of their balance of payments. In any financial period there... read more

A profit made because an investment is sold for more than its purchase price. The term "capital gain" should not be confused with the definition of Capital... read more

A distribution to investment company shareholders from net long-term capital gains realised by a regulated investment company on the... read more

A tax levied on the sale of an asset at a profit. For example, if you buy a piece of land and then later sell it for R100 000 more than you paid... read more

A term which describes those businesses which use huge amounts of capital to make a profit. Maybe they have plant, machinery and land tied up in... read more

A broad term which incorporates any market where capital is raised. Mostly this means either the stock market or the bond market. Capital... read more

A policy of keeping the cash which a business has in the company rather than paying it out in the form of dividends or using it for capital... read more

This is an unusual corporate action which involves the return to the shareholders of a company of part of the capital which they contributed... read more

This is the way in which a company has raised the capital needed to establish and expand its business activities or, more specifically, the number... read more

Also called "bonus issues", these do not involve transfer of cash between the company and its members. They occur when a company feels it desirable... read more

This is the process when loans or interest payable are converted to capital. This alters the gearing or borrowing ratio of the... read more

A socio-economic system in which the factors of production are substantially controlled by the private sector rather than the government. Adam Smith... read more

A socio-economic system in which the factors of production are substantially controlled by the private sector rather than the government. Adam Smith... read more

This refers to the  conversion of an expense from the income statement into an asset on the balance sheet. This is one of the... read more

This is a charting term which refers to the lowest point in a bear trend. It is the point where even the most optimistic of the bulls... read more

An index where the influence of components of the index is limited to a specific percentage of the total. For example, the JSE Top 40 index has a... read more

The is a policy established in terms of the Carbon Tax Act (15 of 2019) in terms of which taxpaters who are subject to carbon tax may make use of certain allowances... read more

A tax introduced by President Cyril Ramaphosa from 1st June 2020 in terms of the Carbon Tax Act (15 of 2019). In terms of this Act, companies will be taxed... read more

The amount of greenhouse gas (GBG) emissions (particularly carbon) put into the air by a person, company or other organisation. Your carbon footprint... read more

A technique whereby cyanide leaching and granulated activated carbon are used to absorb precious metals. The "loaded" carbon is then separated and the gold... read more

This means achieving a position of zero net emissions of greenhouse gases (GHG) by off-setting emissions with carbon credits or by carbon removal. Some... read more

The is a policy established in terms of the Carbon Tax Act (15 of 2019) in terms of which taxpaters who are subject to carbon tax may make use of certain allowances... read more

A tax introduced by President Cyril Ramaphosa from 1st June 2020 in terms of the Carbon Tax Act (15 of 2019). In terms of this Act, companies will be taxed... read more

The movement of cash from a low interest country or area to a high interest country. Emerging economies typically have considerably higher interest... read more

A member of a futures exchange, usually a clearing house member, through which another firm, broker or customer chooses to clear all or some... read more

The cost of storing a physical commodity, such as grain or metals, over a period of time. The carrying charge includes insurance, storage and interest... read more

A group of companies that together have a sufficiently large share of a particular product or industry so that they can force prices up by not competing... read more

A balance sheet asset which appears among the current assets as "Cash and Bank Balances" . Cash is part of the company's working capital... read more

A company which has cash or near-cash as its only asset. Besides the income derived from investing this cash, these companies... read more

The ratio of operating cash flow to EBITDA (earnings before interest, taxation, depreciation and amortisation).... read more

This is the amount of cash coming into a company less the amount going out. Cash flow is important because a profitable company can... read more

A place where people buy and sell the actual commodities (i.e., grain elevator, bank, etc.) also often known as a "spot market" to distinguish... read more

An accounting ratio used to determine whether a company's current assets excluding its stock (i.e. just its debtors' book... read more

A method of settling certain futures or options contracts whereby the market participants settle in cash (rather than delivery of the... read more

A formation usually associated with point & figure charting where the chart makes a triple top, breaks above that top and then... read more

This is a publicly advertised announcement made by a listed company to urge shareholders to exercise caution when trading in its shares.... read more

Contingent business interruption (CBI) is a type of business insurance that covers a business against the interruption of its business by a disaster. The business... read more

Chicago Board of Trade. The CBOT is a global commodity futures exchange trading treasury bonds, corn, soybean, wheat, mini-sized Dow,... read more

The JSE has very strict rules about what listed companies can and cannot do. If these rules are ignored or broken the JSE sometimes issues... read more

A government or quasi-governmental organization that manages a country's monetary policy. For example, the U.S. central bank is the Federal Reserve, and... read more

This is a state-owned and controlled company established in terms of the Central Energy Fund Act (38 of 1977) which was originally established by the National... read more

The role of a central depository is to maintain records of all purchases and sales of securities on organised exchanges within the country. In South... read more

A CSDP is a person authorised to perform custodial, administrative or settlement duties. The central securities depository (CSD) in South Africa is known... read more

The leader of a company's board of directors. The CEO is in charge of and responsible for everything that happens in the company. However,... read more

A security which is represented by a certificate. This can be the case for equity shares in South Africa, but since dematerialisation... read more

To become a certified financial planner (CFP) you must have a post-graduate qualification from one of the recognised Financial Planning Institute's (FPI) approved... read more

A derivative contract that is not guaranteed by any organised exchange - which means that the counter-party risk is carried by the person... read more

The Chief Financial Officer (CFO) is the senior executive responsible for managing the financial affairs of a company. The CFO's duties include tracking cash flow,... read more

A tax levied on the sale of an asset at a profit. For example, if you buy a piece of land and then later sell it for R100 000 more than you paid... read more

An oscillator created by subtracting a 10-day Exponential Moving Average (EMA) from a three-day EMA of the accumulation /distribution line. This... read more

The chairman of the board of directors of a company is usually appointed by the directors. His position is in no way different from the other... read more

Most annual financial statements contain a Chairman's report, although this is not a requirement of the Companies Act. It is worth reading the chairman's... read more

A technical analysis term which refers to a period during which a data stream oscillates between upper and lower parallel channel lines. You will... read more

Those institutions which are established in terms of Chapter 9 of the Constitution of South Africa. There are six chapter 9 institutions - the Electoral Commission,... read more

Many companies listed on the JSE were founded or are run by a charismatic leader. The problem with this is that when that leader leaves the... read more

Charles Dow was one of the founders of Dow Jones & Co. and the originator of the famous Dow Jones indexes. He developed the "Dow Theory" of market... read more

In the context of the share market, this is a display or picture of a security that plots price and/or volume (the number of shares... read more

A member of the South African Institute of Chartered Accountants (SAICA). A chartered accountant (CA) is a person who has passed his bachelors degree (usually... read more

The analysis of group investor behaviour, as reflected in the patterns of share prices and volumes, indices, exchange... read more

The manner in which the five data points for a share are displayed in a chart. Every trading day, every share has a price for its high,... read more

The meaning of the word "cheap" in the share market is not the same as it is in common parlance. When a share is regarded as cheap, then it is perceived... read more

The Chicago Mercantile Exchange (CME). The CME is the largest futures exchange in the United States and also owns and operates the largest futures... read more

The leader of a company's board of directors. The CEO is in charge of and responsible for everything that happens in the company. However,... read more

The Chief Financial Officer (CFO) is the senior executive responsible for managing the financial affairs of a company. The CFO's duties include tracking cash flow,... read more

A communications barrier between members or departments of a financial institution to prevent the transfer of price sensitive information. Chinese... read more

A hard, corrosion-resistant, brittle metal processed through a smelter into ferrochrome and used as an additive to make stainless steel. South Africa produces... read more

A hard, corrosion-resistant, brittle metal processed through a smelter into ferrochrome and used as an additive to make stainless steel. South Africa produces... read more

Established by the Companies Act, this commission is responsible for registering companies in South Africa and maintaining a register of all companies.... read more

A system of limiting trading highs and price limits on equities and derivatives markets designed to provide a cooling-off... read more

This Act replaces the Unit Trust Control Act and the Participation Bonds Act and it came into effect in 2003. It regulates any scheme where members of the... read more

Any substantial disturbance conducted illegally by a large group of civilians. South Africa is no stranger to civil unrest. In fact it is estimated that there... read more

A ratio used by the insurance industry to determine its profitability. The ratio is the total of claims as a percentage of insurance premiums earned.... read more

Some listed companies may issue a variety of different shares with different risk profiles to entice investors to support them.... read more

This is a clause in an agreement which allows one of the parties to retrieve monies already paid under certain specific circumstances. Typically, employee contracts... read more

A member of an exchange clearing house responsible for the financial commitments of its customers. All trades of a non-clearing member must... read more

A major shift in the earth's climate, almost certainly caused by the build-up of so-called greenhouse gases like carbon dioxide and methane. Current research... read more

This is the price at which the last transaction of a particular share took place during the trading session being reported on. The uncrossing... read more

A type of juristic person designed for use by small businesses to give them the benefits of limited liability but without the red tape and... read more

When the share market stops trading at the end of each trading day. The share price at the close is what is used in all charts... read more

The time between the end of a company's financial year and the publication of its audited financial statements. For JSE companies,... read more

Last day on which an offer made by a company to its shareholders may be accepted (e.g. in the case of a rights offer or an offer to... read more

This is the price at which the last transaction of a particular share took place during the trading session being reported on. The uncrossing... read more

At the end of the accounting period, stock (also called "inventory") must be valued to determine the company's "cost of sales". The... read more

The form which must be completed and signed by both the purchaser and seller of shares for a transfer of shares to take place. In practice, since shares... read more

The Chicago Mercantile Exchange (CME). The CME is the largest futures exchange in the United States and also owns and operates the largest futures... read more

A sedimentary rock which is formed by layers of plants, mostly trees which have become compressed into seams in the rock. Coal is combustible as a fossil fuel... read more

An abbreviation for securities traded on an organised exchange. Share codes on the JSE are between 3 and 6 letters long - so,... read more

Developed by the Institute of Directors, this code is similar to the "Principles of Responsible Investing" which is backed by the United Nations and was... read more

This is a lengthy document established in terms of the Broad-Based Black Economic Empowerment Act (53 of 2003) covering such issues as the dismissal of... read more

An economic indicator that moves in the same direction as the business cycle. In other words, it turns when the economy as a whole turns, either... read more

An asset of some type which is given to a lender as security for the money lent. Any asset of value can act as collateral. With property, the land... read more

An asset which acquires value independently of its inherent value because it is collected by a sufficiently large group of collectors. Collectibles can... read more

The process whereby employers negotiate with organised labour on issues such as wages, conditions of employment and other benefits. Both parties have a... read more

This Act replaces the Unit Trust Control Act and the Participation Bonds Act and it came into effect in 2003. It regulates any scheme where members of the... read more

This term is normally used in conjuction with the competition authorities, one of whose functions is to prevent price collusion between companies.... read more

The JSE offers a colocation facility for those companies that want to use program trading to extract very small profits from arbitrage... read more

The commercial sector includes all companies that are involved in the production, processing, or retailing of products and services.... read more

A term which is used to describe those unemployed people in the economy who are still actively seeking employment and have not yet succeeded in finding... read more

An organisation registered in terms of the Banks Act (94 of 1990). Commercial banks are deposit-taking institutions that must be registered under the Act to conduct... read more

Basically these are raw materials such as gold, silver, soya beans, sugar, coffee, steel, etc. Many commodities (such as gold)... read more

This is a currency the strength of which is primarily determined by a or group of commodities. Typically, this can be found in third world... read more

Commodity prices tend to move in cycles lasting several years. For example, the aluminium price bottomed at $1100 a ton in late 1993... read more

An individual or organisation which operates or solicits funds for a commodity pool. A CPO is generally required to be registered with the CFTC.

Shares of companies in the resource sector. Commodity shares are shares of those companies which manufacture, extract or sell... read more

A person who, for compensation or profit, directly or indirectly advises others as to the advisability of buying or selling futures or commodity... read more

The Companies Act (71 of 2008) contains the law concerning the formation and management of companies in South Africa. It can be viewed at:
read more

Established by the Companies Act, this commission is responsible for registering companies in South Africa and maintaining a register of all companies.... read more

An organisation which is registered with the Companies and Intellectual Properties Commission and incorporated in terms of the Companies Act (71... read more

The Companies Act (71 of 2008) allows a company to buy back its own shares in the open market, provided it can pass a solvency and... read more

In terms of the Companies Act (71 of 2008) every company must have a registered office. That office must be where certain records are maintained... read more

A certificate which is issued when a company is registered with the Companies and Intellectual Property Commission (CIPC). The certificate is proof... read more

This is a 16-digit number consisting of 8 numbers followed by 2 letters and then a further 6 numbers which is given to identify each company and limited... read more

In terms of section 86 of the Companies Act (71 of 2008), public or state-owned companies must appoint a company secretary who must be a permanent... read more

In South Africa, company tax is 28% of a company's taxable income. Taxable income is the total of a company's incomes less all its deductible... read more

These are an immensely valuable source of information for private investors. Almost every listed company maintains a website on which it posts... read more

The previous equivalent financial period with which the current periods figures are comparable. For example, a company's headline earnings per share... read more

The Companies Act (71 of 2008) requires that companies provide comparative figures when reporting their financial results. This usually takes... read more

A technical indicator which compares the price movement of a stock with that of its competitors, industry group or the entire market.... read more

The regular remuneration of unskilled or semi-skilled, usually blue-collar workers in exchnage for their labour. Wages are often paid weekly or bi-weekly.... read more

This Act sets up the Competition Tribunal, Appeal Court and Commission. Together these three organisations prosecute breaches of the Act and require notification... read more

The Competition Tribunal is established in terms of section 26 of the Competition Act (89 of 1998) to hear and decide on competition cases prepared by the... read more

These days, companies, and especially listed companies have a host of rules and regulations that they must comply with - from the Companies Act... read more

Compounding occurs where the return from an investment is added to the original capital and then itself earns a further return which is further added... read more

The forced acquisition of minority shares by a majority of more than 90% of the shareholders of a company. In terms of section 124 of the... read more

Finance which is provided at very low interest rates or even as a donation in order to further an altruistic objective. For example, in 2020, Escom was... read more

An offer made to the shareholders of a company conditional to the occurrence of some event. Typically, where a take-over bid is being made,... read more

These are the conditions that must be met before a major transaction, such as the sale of a subsidiary or a take-over can take place. Typically,... read more

A charting pattern giving credibility to a formation which has taken place.  Typically, it is advised to wait for at least three days... read more

The next candle in a candlestick formation which confirms the previous reversal signal, confirming that a change in the direction of... read more

A situation in which an offical (either commercial or government) can derive a personal benefit from a decision which he is making or is a party to.  Conflicts... read more

A series of trading days in which there is no visible progress in price either upwards or downwards. This is also known as a "sideways" market... read more

These are massive, usually multi-national, holding companies involved in a wide variety of industries. Their size tends to make them immune to developments... read more

An average of the forecasts of a group of analysts or economists for a particular economic indicator or the profit of a particular... read more

1. In technical analysis, where a chart moves up and down within a narrow range, bounded by a support and resistance... read more

An economic index of activity in the construction sector prepared and produced by the economist Roelof Botha, on behalf of Afrimat, every quarter.... read more

This is the total of what consumers spend on goods and services for their personal use. It makes up about 60% of gross domestic product (GDP)... read more

Anything which is normally bought by consumers as the end user. This differs from industrial goods, which are bought with the objective of producing some... read more

The measure of the degree to which the currency of a country is losing purchasing power over time through inflation. In South Africa, the... read more

This is the total of what consumers spend on goods and services for their personal use. It makes up about 60% of gross domestic product (GDP)... read more

Consumption is the buying of goods and services by consumers. Private consumption expenditure by consumers accounts for about 60% of gross domestic... read more

Consumption is the buying of goods and services by consumers. Private consumption expenditure by consumers accounts for about 60% of gross domestic... read more

A linear function representing the realtionship between disposable income and consumer spending. The function assumes that there is a certain amount... read more

A futures market were prices in succeeding delivery months are progressively higher. The opposite of "backwardation".

Contingent business interruption (CBI) is a type of business insurance that covers a business against the interruption of its business by a disaster. The business... read more

A derivatives chart in which the price scale for the data for the end of a given contract and the data for the beginning of the next contract are... read more

A pattern in technical analysis which suggests that a chart is diverging slightly from it's trend however will eventually continue... read more

Those operations which a company intends to continue with. Companies are always concerned with their focus and they tend to sell or discontinue those... read more

A derivative contract that is not guaranteed by any organised exchange - which means that the counter-party risk is carried by the person... read more

The month in which delivery is to be made in accordance with the terms of the futures contract. Also referred to as Delivery Month.

An investor who believes that to beat the market you have to be right when the market is on average wrong. Contrarians delight in buying when... read more

Section 2 of the Companies Act (71 of 2008) says, "a person controls a juristic person, or its business, if:

read more

The additional cost which an acquiring company must pay in order to obtain control of a subsidiary. This cost is incurred because control... read more

A shareholder who owns more than 50% of a company's voting share capital and can therefore control the company's activities.

Multiplies the deviation of each variable from its mean, adds those products and then divides by the number of observations. The objective is to provide... read more

When futures prices and spot prices come together at the futures expiration. Futures contracts expire at the end of each quarter - in other... read more

This is a preference share which can be converted into an ordinary share on a specified future date. This gives a higher degree of security than... read more

These are shares, debentures or other securities which are convertible either voluntarily or compulsorily into ordinary shares... read more

One of the elements with the symbol "cu". Copper is a maleable base metal which conducts electricity and heat very efficiently. It is used for most electrical... read more

A long-term price momentum indicator. For example, a 10-month weighted moving average of the sum of the 14-month rate of change and... read more

The primary business of any company. You will often hear of companies selling off their non-core businesses in order to focus on their most... read more

Any action taken by a company that has a major effect on its shareholders. Corporate actions are divided into those which require the shareholder... read more

A set of rules and procedures which control the way in which a company is managed in the interests of its primary stakeholders including its shareholders,... read more

The way in which the public perceives a company. This can be very important to the company's marketing and to its share price. Companies with... read more

An organisation which is registered with the Companies and Intellectual Properties Commission and incorporated in terms of the Companies Act (71... read more

This term is used quite loosely to mean any short-term downward change in the direction in which a share or market is moving. More strictly, it refers... read more

This is the degree to which two continuous data streams (such as two share price graphs or currencies) are the same - i.e. the degree to which... read more

The recording and analysis of a company's costs in such a way as to improve its profitability. Cost accounting is distinguished from financial accounting.... read more

The cost of a given share or group of stock shares. This is used as a bench-mark to establish whether the investment is profitable or not and by... read more

The additional cost which an acquiring company must pay in order to obtain control of a subsidiary. This cost is incurred because control... read more

This is a mining term which refers to the cost extracting a metal or mineral from its ore body so that it can be sold. In South Africa, this concept is... read more

An accounting measure which endeavours to measure the cost of the goods sold during the accounting period. The method is to value the inventory... read more

This something which a company has to pay for. Companies have two types of expenses - those which go up and down with sales and those which have to be paid... read more

The trading system used in the 1980's and 1990's by the Paris Bourse in France. This system gave way to the Nouveau Systeme de Cotation (NSC) in 2000, but the... read more

A part-ownership of a company. The ownership of companies is divided into individual shares which, if the company is listed on the JSE, can... read more

One of the participants in a financial transaction. This term is typically used when speaking of foreign exchange (FX) transactions.

The risk that the other party to a securities transaction will not fulfil their obligations. In other words, if you are buying and the seller will not supply... read more

A period in a price chart showing movement opposite to the direction of the prior time period. Also called a "retracement" or sometimes a "counter... read more

A period in a price chart showing movement opposite to the direction of the prior time period. Also called a "retracement" or sometimes a "counter... read more

An agreement reached by a company with its creditors for the repayment of principal and interest on its outstanding debts. Debt... read more

Purchasing back a contract sold earlier. For example, if a share is sold short, the short seller is exposed until he buys back sufficient shares... read more

A short call option or put option position which is covered by the sale or purchase of the underlying futures contract or physical... read more

Writing a call option against a long position in the underlying security. By receiving a premium, the writer intends to realize additional... read more

In January of 2020, the World Health Organisation confirmed a corona virus (SARS-CoV-2) as the causative agent of coronavirus disease 2019. (COVID-19). By June... read more

The measure of the degree to which the currency of a country is losing purchasing power over time through inflation. In South Africa, the... read more

The consumer price index excluding the effect of interest rate changes. This is the number that the Reserve Bank uses in their inflation targeting.... read more

An individual or organisation which operates or solicits funds for a commodity pool. A CPO is generally required to be registered with the CFTC.

A significant and sudden fall in the total market. In general, anything less than a 20% fall in the market as a whole is regarded as a correction... read more

This term is used to describe a consumer who makes use of credit in various forms. In South Africa, about 25m people are credit active - and over 40% of those... read more

This is a banking ratio which is the total impairment losses as a percentage of total loans and advances. This shows how much the bank... read more

Amounts owing to the company's creditors in the balance sheet. These appear under current liabilities. These amounts are owed by the... read more

Developed by the Institute of Directors, this code is similar to the "Principles of Responsible Investing" which is backed by the United Nations and was... read more

This is a 16-digit number consisting of 8 numbers followed by 2 letters and then a further 6 numbers which is given to identify each company and limited... read more

The exchange rate between any two currencies that are considered non-standard in the country where the currency pair is quoted. For example, in the... read more

A digital or virtual currency used as a medium of exchange using cryptography for security, transactional accuracy, creation and verification. These currencies... read more

The role of a central depository is to maintain records of all purchases and sales of securities on organised exchanges within the country. In South... read more

A CSDP is a person authorised to perform custodial, administrative or settlement duties. The central securities depository (CSD) in South Africa is known... read more

A person who, for compensation or profit, directly or indirectly advises others as to the advisability of buying or selling futures or commodity... read more

Previously the 4 Africa Exchange (4AX), the Cape Town Stock Exchange began operations as a South African stock exchange in March 2017. To differentiate... read more

Shares are said to be "cum div" in the period between declaration of the dividend and the last day to trade. A sale of shares while they are "cum... read more

A preference share accumulates its dividend in the event of the preferential dividend being passed for one or more years. Preferential dividends... read more

An accumulation pattern observed on bar charts. The pattern lasts from seven to 65 weeks; the cup is in the shape of a "U" and the handle... read more

The safeguarding and management of the financial affairs and estate of another person because they are incapacitated by their absence or because they are incapable... read more

Originally an overflow of companies that were too small to list on the New York Stock Exchange, the "Amex" or "the curb" as... read more

A medium of exchange used as a store of value or in the commercial exchange of value between persons or organisations. Historically, currencies were physical commodities... read more

A hard asset, usually gold, that is used to back a national currency. Originally when paper money was first used, these were certificates... read more

An exchange rate between the traded currencies of two countries. Thus the US dollar/euro, the pound/rand and the yen/dollar are all currrency crosses... read more

This is an element of the balance of payments (BOP) toegther with the capital account. It shows a country's trade in goods and services... read more

An item on a balance sheet which includes any assets which can easily be turned into cash (have high liquidity) and which will only be held... read more

Any liability that must be paid within a year from the date of the balance sheet. These are mainly amounts owed by the company, which must... read more

The ratio of current assets to current liabilities. The objective of this ratio is to determine whether the company can meet its short-term... read more

The number assigned by the Committee of Uniform Security Identification Procedure that appears on all securities documents. Each security is given a number... read more

An Act which dealt with the transition from an open-outcry share market with physical share certificates to an electronic market with dematerialised... read more

Shares, industries and markets move in cycles. There are three types of cycles: primary, secondary and daily fluctuations. Primary trends last from... read more

A cyclical share is one which is heavily impacted by the business cycle. When the economy is going through a slow growth period (a recession)... read more

A cyclical share is one which is heavily impacted by the business cycle. When the economy is going through a slow growth period (a recession)... read more

Charles Dow in his "Dow Theory" proposed that share prices, and especially indexes, move in three distinct patterns -... read more

The difference between the high and low price during one trading day. This range shows the degree of uncertainty prevailing... read more

A top reversal candlestick formation which consists of a long green candle followed by a red candle. Confirmation of this signal would... read more

Trade which takes place between institutional investors on private confidential exchanges which are not open to the public. Institutions do this... read more

The process of using super-computers to sift through the massive quantities of data produced every day by the securities markets to establish potentially... read more

Altering data to some extent to be more accurately analysed; smoothing, reducing unwanted data, removing trend. Processing data is mathematically transforming... read more

A data stream is any continuous flow of end-of-day financial data which can be displayed as a chart. The most common forms of this are the end-of-day... read more

The date on which a rights issue closes. A rights issue is a corporate action in terms of which a company issues additional shares... read more

The date on which a dividend is declared by a company's board of directors once they have seen the results from the interim... read more

The date on which a company was granted its certificate of incorporation by the Companies and Intellectual Property Commission (CIPC). Every company... read more

One of the dates associated with the payment of a dividend by a listed company. The dates are the date of declaration when the board... read more

The date on which a dividend payout or rights issue is based. These "corporate actions" apply to shares which are in the company register... read more

The extent to which a share moves during the course of the trading day on the Stock Exchange. You will find the day's move quoted as a separate... read more

This is a state-owned enterprise which focuses on supporting projects which will enhance the standard of living and infrastructure of South Africa... read more

The removal of a security from an organised exchange - after which it can no longer be traded on that exchange. This typically happens in the share... read more

A rebound in a market that sees prices recover from a very sharp fall and come back up somewhat. Usually this occurs during a bear market... read more

In the context of the share market this means a transaction whereby shares are exchanged for cash, either in the primary market or the secondary... read more

An individual or firm acting as a principal or counterparty to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing... read more

The costs of trading in shares are brokerage - which varies according to the stockbroker you are dealing through, STRATE settlement... read more

In technical analysis when the 50-day moving average crosses down through the 200-day moving average on any data stream (i.e. a share, commodity,... read more

The reduction of a commodity currency by adding a base metal - such as lead. During the time of the Roman empire, periodically the gold coins... read more

This is a form of long-term loan. A company issues debentures, usually at R1000 each, at a fixed percentage return. Debentures are then redeemable... read more

A stockbroking account with no positions and a negative adjusted total equity. A debit balance typically arises as a result of a trader losing... read more

Debswana Mining Company Limited (Debswana) is a 50/50 joint venture formed in 1969 between the government of Botswana and De beers. De beers is 85% owned by Anglo... read more

Debswana Mining Company Limited (Debswana) is a 50/50 joint venture formed in 1969 between the government of Botswana and De beers. De beers is 85% owned by Anglo... read more

Money owed by one person (natural or juristic) to another. Debt which is expected to be repaid withing normal commercial periods of 30, 60 or 90 days is... read more

A debt ceiling is a legally imposed limit to the amount of debt which the treasury of a country can uncur. In America the constitution (article 1,... read more

An agreement reached by a company with its creditors for the repayment of principal and interest on its outstanding debts. Debt... read more

A form of long-term debt whereby the borrower agrees to pay the lender annual interest (the "coupon") until the debt is settled or converted into... read more

A debt ceiling is a legally imposed limit to the amount of debt which the treasury of a country can uncur. In America the constitution (article 1,... read more

A period of grace on the repayment of debt and the interest due on it. If a company is placed under business rescue, then it is immune... read more

This refers to the ratio between a country's government debt and its Gross Domestic Product (GDP). A low debt to GDP ratio suggests that a... read more

This is the ratio of an individual's monthly debt repayments and other expenses to their gross income. In South Africa, we have an average... read more

A debt trap is when a borrower is in a cycle of re-borrowing or rolling over their debt. This can occur because of high interest rates or because... read more

The ratio of a company's debt to its earnings before interest, taxation, depreciation and amortisation (EBITDA).... read more

The ratio of shareholders' equity in the company (share capital and reserves) to the company's borrowing. The company... read more

An item on the balance sheet which shows the amount the company is owed, and which is to be paid over the short term. It is common for companies... read more

The average number of days that it takes for a company to collect its debts. This can be calculated by dividing the debtors figure and then multiplying... read more

Amounts owing to the company, usually by customers who have bought products on credit. This is another term for "debtors" and appears in the balance... read more

A debtors' book is a collection of all the receivable invoices, i.e the cash that is due or owing to a business from it's clients.

The date on which a dividend is declared by a company's board of directors once they have seen the results from the interim... read more

A deep-in-the-money call option has the strike price of the option well below the current price of the underlying instrument. A deep-in-the-money... read more

Some JSE-listed companies perform well even in a recession and they are known as "defensive shares". Typically they are in sectors... read more

The distant delivery months in which futures trading is taking place, as distinguished from the "nearby" futures delivery month which refers to the next futures... read more

This is a share which has even less rights than an ordinary share. Preference shares receive their dividends and payments on liquidation... read more

When a company computes income tax expense, it bases that computation on taxable income per the Income Statement. The income taxes... read more

This is the difference between government revenue and expenditure. Typically, governments spend more than they receive from taxes and other types... read more

The opposite of inflation. A period where the purchasing power of money increases in terms of a basket of goods and services.

A crash which is caused or exacerbated by a shortage of money within the economy. There has only been one deflationary crash in recorded history... read more

Market quotations which are delayed by the various futures exchange's required time period, usually 10-20 minutes. The JSE provides... read more

Market quotations which are delayed by the various futures exchange's required time period, usually 10-20 minutes. The JSE provides... read more

This refers to a director of a company that has done something in contradiction of the Companies Act. Directors are expected to act in the... read more

The transfer of the cash commodity from the seller of a futures contract to the buyer of a futures contract. Each futures exchange has specific... read more

An economics term which refers to the extent to which a good or service is needed in the economy. When the good or service is widely needed... read more

The replacement of physical share certificates with an electronic record. In South Africa this record is maintained by STRATE (Share TRAnsactions... read more

The breaking up of a company into smaller component companies. This is usually done to improve focus and to give each operating unit autonomy over decision... read more

This was originally a cost of not off-loading a chartered ship within an agreed time period. Shipping charters typically include an amount of "laytime" which is... read more

In modern portfolio theory the central concept is that share prices are impossible to predict because there is no "dependence" between today's... read more

The process of charging the value of a fixed asset against the company's profits at the same rate at which it is expected to wear out or become... read more

A economic term which refers to an extended period of very low economic activity. A depression is considerably worse and deeper than a recession. Recessions... read more

The depth of the market for a particular share is a display of the best three bids and the best three offers for that share which have... read more

A financial instrument, traded on or off an exchange, the price of which is directly dependent upon the value of one or more underlying securities,... read more

When a company wishes to list on the Alt-X market it must appoint a designated advisor. The main role of a Designated Adviser is to... read more

The reduction in a company's inventory levels. Inventory or stock is a part of a company's working capital and as such it means money tied... read more

The reduction of a currency's value in a fixed exchange rate system. Most currencies are allowed to float and are freely traded with market... read more

An economy which is in a development phase - as opposed to a first-world economy which is said to be fully developed. Emerging economies generally... read more

This is a state-owned enterprise which focuses on supporting projects which will enhance the standard of living and infrastructure of South Africa... read more

A share whose price chart goes from the bottom left-hand corner to the top right-hand corner. There are very few shares which can be described... read more

A solid crystalline form of carbon with the greatest hardness and heat conductivity of any natural substance. Diamonds have both industrial and jewellery use.... read more

An index that measures how many shares are positive or increasing in price. It can be used to tell the underlying strength of the market,... read more

This is headline earnings per share (HEPS) calculated using the number of shares in issue at the end of the financial period rather than the... read more

In the context of the share market, dilution occurs where a company issues additional shares without receiving commensurate earnings... read more

Developed by J. Welles Wilder, DMI measures market trend. The concept of Directional Movement is based on the assumption that in an upward trend... read more

All public companies are required to have at least two directors and all private companies at least one. The directors are appointed (and confirmed... read more

The directors of a company are allowed to deal in the shares of their company, but in terms of the JSE rules, they must... read more

The DMA was formed in terms of the Insider Trading Act (135 of 1998) to investigate and take legal action where appropriate in cases of financial market... read more

The Companies Act requires companies to put before the Annual General Meeting (AGM) a directors' report with respect to the state of affairs of the... read more

An audit opinion where the auditor refuses to give an opinion because he feels that he can place no reliance on the underlying financial accounts.... read more

This is an audit opinion given when the auditor cannot obtain sufficient documents and information to support their opinion. This can happen because management... read more

The concept of disclosure is entrenched in the Companies Act. The Act is concerned to ensure that shareholders are properly informed of all the information... read more

Companies are always trying to be focused on their core business. To achieve this they may decide from time to time that a particular division or... read more

This is a stockbroking firm that does not undertake research into listed companies or give advice. For this reason the dealing costs... read more

The mechanism by which the central bank provides short-term funds to commercial banks and other eligible institutions. Originally, central banks... read more

A process whereby a future flow of incomes is reduced to a current value by applying an "internal rate of return" (IRR). For example, if you are... read more

The price of a share is the average of all investors' discounted cash flows of the future dividends of the company. If... read more

This is an adult person who is part of a country's labour force but who has not been able to find work for an extended period of time. Such people would like to... read more

An account opened with a stockbroker where the client has entered into an arrangement with the stockbroker that authorises the stockbroker to conduct transactions... read more

This term is usually applied to investors in South Africa who decide to withdraw their investment. Disinvestment impacts directly on the capital... read more

The income which is left for a consumer after all his main expenses have been met - such as his rent or mortgage bond repayment, money for food and clothing,... read more

In terms of the Companies Act, a dissenting shareholder is one who disagrees with a fundamental transaction being contemplated by the majority shareholders.... read more

This refers to a company which does not have sufficient short-term cash flow to meet its immediate expenses. When a company is in "financial distress",... read more

A concept from the old Companies Act which aimed to preserve the capital of companies. In terms of that Act, dividends could only be... read more

Distributed Ledger Technology (DLT) is a computer technique which is used to create a completely reliable and and 'unhackable' database. The most common use is... read more

That portion of a company's earnings which is paid out to shareholders - also sometimes called a "distribution". Most blue chip companies... read more

1. The payment of a dividend.
2. Any set of related values described by an average (that is, mean), which... read more

A sideways to downward market, usually at the top of a bull trend where shares are being sold off by the "smart money"... read more

The process whereby a company (or individual) spreads its investments among a number of different enterprises so as to reduce its exposure... read more

Companies are always trying to be focused on their core business. To achieve this they may decide from time to time that a particular division or... read more

That portion of a company's earnings which is paid out to shareholders - also sometimes called a "distribution". Most blue chip companies... read more

The number of times the dividend could be taken out of the earnings. For example, if a company has earnings (profits) of R50 000 and pays... read more

A distributable reserve which is specifically set up to ensure that dividends remain stable despite changes in earnings. If a company normally... read more

Most of the larger listed blue chip companies pay two dividends each financial year - an interim and final. They also usually have... read more

A program offered by a publicly held company in which dividends are used to buy more shares of the company. This process reduces the number... read more

This occurs where a share is bought just before the last day to register (LDR) for its dividend and then sold immediately afterwards. The... read more

A 20% tax (as per the 2017 budget speech) on dividends paid by all South African taxpayers, but withheld by the company paying the dividend. DWT... read more

Dividends per share expressed as a percentage of the current market price. For example, if a company pays a dividend of R10 000 and it has... read more

The ordinary dividend of a company for the most recent financial year divided by the number of shares in issue. The DPS is calculated... read more

Charles Dow was the first person to construct an index. His first index was the "transportation average" which he constructed in 1884 and then maintained... read more

Distributed Ledger Technology (DLT) is a computer technique which is used to create a completely reliable and and 'unhackable' database. The most common use is... read more

The DMA was formed in terms of the Insider Trading Act (135 of 1998) to investigate and take legal action where appropriate in cases of financial market... read more

A candlestick charting term which describes a trading session in which the opening price and closing price for a share are the same... read more

A Doji Star is a trend reversal pattern which is composed of a long black body followed by a doji (a pattern with the same opening and closing... read more

A unit trust which is focused on investments into the local equity market. In other words, excluding overseas investments. Profile Media has... read more

An alloy of gold and silver usually created at the mine before being moved to the refinery. Dore is usually cast in bars of bullion. At the refinery... read more

Technology shares, specifically those which deal with internet based products or telecommunications. From 1997 to 1998, these shares did particularly well... read more

The price action of a security or market average where it has declined twice to the same approximate level, indicating the existence... read more

An economics term which means counting the same item twice so producing an erroneous result. This can happen with the calculation of gross domestic product... read more

Double smoothing in the context of the share market and technical analysis simply means making a moving average of a moving average. This... read more

An agreement between two countries the objective of which is to avoid double taxation. For example, South Africa and the UK have a double taxation agreement which... read more