(Un) Common Stock Market Lingo

Uploaded by : DreamGains Financials, Posted on : 27 Aug 2015

 

All the Boats Rise

 

 All the Boats Rise

 

When the tide comes in, all the boats rise. When the stock market is quickly rising, there is a tendency for most stocks to increase in value due to over-optimism. The opposite is, When the tide goes out, all the boats sink, which is due to over-pessimism.

Bear Hug

 

Bear Hug

 

When a company offers to buy another company at a signficant premium. The intent of a high offer price is to entice shareholders of the target company to vote in favor of a merger, and against its management. Usually considered a hostile takeover offer.

Dead Cat Bounce

 

Dead Cat Bounce

 

After a stock (or even the entire market) has dropped substantially, there is often a moderate bounce to the up side. This bounce may be caused by value investors believing the stock had become undervalued at this beaten down price, or by short sellers covering their positions as shorting was compounding on the way down.

Field Bet

 

Field Bet

 

Buying a group of stocks in the same industry, most often when a group is unprofitable and oversold. The theory is that some companies may go bankrupt, but one or more may survive and incur large gains in the stock price.

Painting the Tape

 

Painting the Tape

 

When a group of investors illegally move a stock by trading it all at the same time. This happens every day, just watch the tape or most active stocks, but don’t get sucked in. Day trader newsletter emails can cause such moves.

Stagflation

 

Stagflation

 

A state of the economy when Unemployment is high and Inflation is high. Quite often, stagflation is caused by massive deficit spending by the Government. This deficit spending reduces private sector output with higher inflation.

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