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Financial Abbreviations and Business Abbreviations
Some more common ones related mainly to value investing are listed below.
A AAII: American Association of Individual Investors. ADR: American Depositary Receipt. A negotiable certificate issued by a U.S. bank representing a particular number of shares in a foreign stock that is traded on a U.S. exchange. AGM: A required yearly meeting of shareholders that allows stakeholders to be informed and involved with company business. AMEX: American Stock Exchange. ASIC: Australian Securities and Investments Commission. Enforces company and financial services laws to protect consumers, investors and creditors. It also regulates and informs the public about Australian companies, ASX: Australian Stock Exchange. AUD: Australian Dollar. BRIC: An acronym standing for emerging countries Brazil, Russia, India and China. Mexico is often considered as the 'fifth BRIC'. CAC-40: Compagnie des Agents de Change-40. French stock index. CAD: Canadian Dollar. CAGR: Compound Annual Growth Rate of a company. More ... CAPM: Capital Asset Pricing Model. CAVM: Capital Asset Valuation Model. CBOE: Chicago Board Options Exchange. See also VIX. CDO: Collateralized Debt Obligation. (CDOs) represent different types of debt and credit risk often referred to as 'tranches' or 'slices'. Each slice has a different maturity and risk associated with it. The higher the risk, the more the CDO pays. CDR: Chinese Depositary Receipt. A type of depositary receipt that is traded on Chinese stock exchanges. Foreign companies can use CDRs to allow both Chinese institutional and private investors to own their stock. CEO: The highest ranking executive in a company. CFD: Contract For Difference. A highly leveraged derivative product that allows speculators to bet on the movement in the price of an underlying share. Like other derivatives, CFDs do not entitle you to physical ownership of the underlying share. This is not a financial product that value investors would be interested in. More ... CFO: The senior manager in a company who is responsible for overseeing all the financial activities of the company. CFP: Certified Financial Planner. More ... CHESS: Clearing House Electronic Sub-register System. A computer system operated by the Australian Stock Exchange (ASX) that facilitates stock transfer from a seller to a buyer. CIC: China Investment Corporation. A Chinese government-sponsored entity that seeks to invest in securities and commodities abroad. CPI: Consumer Price Index. A measure that determines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care CSRC: China Securities Regulatory Commission. The main securities regulatory body in China, which regulates all securities exchanges and futures markets activity within China. DAX: A stock index that represents 30 of the largest and most liquid German companies that trade on the Frankfurt Exchange. DCA: Dollar Cost Averaging. More ... DCF: Discounted Cash Flow. More ... DDM: Dividend Discount Model. More ... DJIA: Dow Jones Industrial Average. 'The Dow' is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange (NYSE) and the Nasdaq. DRP: Dividend Reinvestment Plan. More ... EBITA: The Earnings Before Interest, Tax and Amortization. EFT: Electronic Funds Transfer. EMH: Efficient Market Hypothesis. An investment theory that states that it is impossible to 'beat the market' because stock market efficiency causes existing share prices to always incorporate and reflect all relevant information. EPS: Earnings Per Share. It is the ratio of the net annual earnings of a company to the number of shares. More ... ESOP: Employee Share Ownership Plan. ETF: Exchange-Traded Fund. A security that tracks an index, but trades like a stock on an exchange. More ... EVA: Economic Value Added. EVA is Net Operating Profit After Taxes (or NOPAT) less the money cost of capital. FCFE: Free Cash Flow To Equity ratio. It is a valuation measure of how much cash can be paid to the shareholders of the company after all expenses, reinvestment and debt repayment. FOREX: Foreign exchange market. The market where foreign currencies are bought and sold. FRB: Federal Reserve Board. FSA: Financial Services Authority. Regulator of all providers of financial services in the United Kingdom. FTSE-100: Financial Times Stock Exchange 100 stock index, United Kingdom. GAAP: Generally Accepted Accounting Principles are the common set of accounting standards and procedures that companies are required to use to compile their financial statements. GDP: Gross Domestic Product. GFC: Global Financial Crisis. HFT: High Frequency Trading HIN: Holder Identification Number. HSI: Hang Seng Index, Hong Kong. IMF: International Monetary Fund IPO: Initial Public Offering. An IPO is a company that is applying to list on the stock market. More ... IRR: Internal Rate of Return. The internal rate of return (IRR) or IRR formula is the best way to be able to accurately track your stock market share and portfolio performance. More ... LBO: Leveraged Buy Out. The purchase of another company using a significant amount of borrowed money. LIC: Listed investment companies (LICs) may be described as a listed managed investments that can be traded on the stock market. More ... LME: London Metal Exchange. The world's premier non-ferrous metals market. The LME offers futures and options contracts for a range of non-ferrous metals such as copper, zinc, aluminum etc. LSE: London Stock Exchange. LTI: Long-Term Incentive. Relates to executive remuneration. M & A: Mergers and Acquisitions MER: Management Expense Ratio. The ongoing fees and charges typically levied by mutual funds. The MER covers expenses for investment management, marketing, trusteeship legal, accounting and auditing costs. MFI: Magic Formula Investing. A strategy developed by Joel Greenblatt that uses Return on Capital and Earnings Yield to identify good companies available at low prices. More ... MFI: Money Flow Index. An oscillator that uses both price and volume to measure buying and selling pressure. MPT: Modern Portfolio Theory. A theory outlining how risk-averse investors can construct portfolios to maximize expected return based on a given level of market risk, Also called portfolio management theory. MSCI: Morgan Stanley Capital Index. Stands for a family of global equity benchmarks (indexes) that are the most widely used international indexes by institutional investors on which to compare their performance. NASDAQ: National Association of Securities Dealers Automated Quotation system. NAV: Net Asset Value. NCAV: Net Current Asset Value, or working capital. NOPAT: Net Operating Profit After Taxes. NPV: Net Present Value. The calculation of NPV for a stock allows its calculated fair value to be compared to the current stock price. More ... NYSE: New York Stock Exchange. OPM: Other People's Money. OTC: Over-The-Counter. A stock traded in some context other than on a formal stock exchange. P/B: Price to book value. The P/B ratio is calculated by dividing the current closing price of the stock by the latest reported book value per share. It is also known as the price-equity ratio. More ... P/E or PE: Price earnings ratio is the current price divided by the earnings per share. It is one of the most commonly used relative valuation measures. More ... PIIGS: Portugal, Ireland, Italy, Greece and Spain. Countries that are considered to have high sovereign risk as a result of large government debt. POP: Public Offering Price. QE: Quantitative Easing. A process by which a central bank increases the credit in its own account in order to use the additional capital to purchase assets which may or may not stimulate the economy. Sometimes referred to as 'printing money'. QOQ: Quarter On Quarter. A measure that calculates the change between one financial quarter and the previous quarter. It gives investors and analysts an idea of how a company is growing over each quarter REIT: Real Estate Investment Trust. More ... ROC: Return on Capital. Includes the combined return on both earnings and borrowings. ROC would be expected to be less than ROE as borrowings involve interest payments. More .. ROE: Return on equity is a measure of how well a company is being managed. It is calculated by dividing the net (tax-paid) profit by the sum of shareholders' ordinary equity and expressing this as a percentage. More .. ROI: Return on Investment S&P: Standard & Poor's. The world's foremost provider of independent credit ratings, indices, risk evaluation, investment research, and data. Solo Build It!: The web hosting company used to build this site. Solo Build It! makes available extensive and valuable back-up tools and information to website authors. More ... SEC: Securities Exchange Commission STI: Short-Term Incentive. Relates to executive remuneration. SMA: Separately Managed Account. Is a share portfolio managed by an investment manager on behalf of an investor who retains individual ownership of each stock in the portfolio in their own name. More ... SME: Small and Medium-sized Enterprise TERP: Theoretical Ex-Rights Price. The diluted share price resulting from a company rights issue. Topix: Tokyo stock exchange stock price index. TSR: Total Shareholder Return. USD: United States Dollar. The currency for the United States of America. VIX: The stock market volatility index of the Chicago Board Options Exchange (CBOE). Also called the CBOE VIX or the VIX indicator. See also COnnors VIX. VWAP: Volume Weighted Average Price. VWAP is calculated by adding up the dollars traded for every transaction (price multiplied by number of shares traded) and then dividing by the total shares traded for the day. WACC: Weighted Average Cost of Capital. WSJ: Wall Street Journal. WTO: World Trade Organization. An international organization dealing with the global rules of trade between nations. XIRR: A variation to the internal rate of return (IRR) formula that allows the calculation of the internal rate of return for non-regular cash flows. More ... Y: Y is a Nasdaq stock symbol specifying that a particular stock is an American Depositary Receipt (ADR). ZIRP: Zero Interest Rate Policy. A policy emanating from the global financial crisis that is attempting to stimulate growth in some countries. Return from Financial Abbreviations to Stock Market Terms
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