Save As You Earn. Employer run schemes for employees to buy shares in the company.
When a new issue is oversubscribed, the procedure whereby applicants receive a proportion of the number of shares for which they applied.
Scrips and enhanced scrip dividends - in this instance the company will announce that shares can be offered in lieu of a cash dividend.
This is where investors in a company are given shares free of charge by the company as a 'bonus'. The result is to increase the number of shares in issue.
The general name given to shares, bonds and similar investments that are often traded on the stock market.
General term for a bank/financial institution that conducts securities investment business.
Investment funds are grouped into a variety of sectors reflecting their investment strategy and objectives. E.g. Global Growth, UK Equity Income and Specialist. Dividing funds into sectors makes it easier to make comparisons between similar funds.
Shows the average of all funds within the same sector.
Shows the position of a fund relative to equivalent funds in the same sector.
The identification number for investments. SEDOL stands for Stock Exchange Daily Official List.
Self Invested Personal Pension (SIPP)
A SIPP is a form of personal pension giving the holder control over how the fund is invested.
Stock Exchange Electronic Trading System. Order driven electronic trading system employed to deal in the FTSE 100 and ex FTSE 100 equities.
The date that any monies outstanding for deals placed needs to be paid by.
Most Fund Managers offer different classes of shares or units in each of their funds, e.g. A class, B class, Retail class, I class etc. These different classes of shares have different levels of Annual Management Charge (AMC) and are designed for different kinds of investors e.g. they can have a different minimum investment amount per transaction.
Share class conversions
Also known as ‘conversions’ this is the process whereby investments in ‘bundled’ share classes are moved by Barclays Stockbrokers into ‘clean’ share classes.
Facility offered by ISA managers whereby they sell your shares and invest the proceeds in an ISA.
The right (but not the obligation) to buy shares at an agreed upon price within a given time frame or on a certain date.
Companies divide their capital into units called shares. Owning shares brings rights – a stake in the business – but also the risk of losing the investment. Although OEICs are funds, they issue shares which represent a share in the net asset value of their fund, and will issue new shares as new investors invest money.
Allegation made against fund managers that they expect prices of shares in which they have invested to rise quickly and are not willing to exert influence on management to improve corporate performance
6 month performance indicators
How an investment has performed in the last 6 months.
Specific investment type. Identifies industry sector of specific investment focus, for example Government bonds, commodity shares, smaller companies, index tracking and convertible bonds.
The difference between the Bid and the Offer Price.
Someone who applies for a new issue of shares intending selling them (at a profit) as soon as secondary market dealings start.
Stamp duty / Stamp Duty Reserve Tax (SDRT)
These are the UK government taxes, charged on the purchases of shares and units.
The stochastic oscillator is a momentum indicator used in technical analysis, introduced by George Lane in the 1950s, to compare the closing price of a commodity to its price range over a given time span. The idea behind this indicator is that prices tend to close near their past highs in bull markets, and near their lows in bear markets. Transaction signals can be spotted when the stochastic oscillator crosses its moving average.
A market in which securities are bought and sold, eg, stocks, shares and gilts and bonds.
Generally used as another word for equities. Technically, this more accurately refers to fixed interest securities.
The division of a company's outstanding common shares into a larger number of common shares. A three-for-one split by a company with one million shares outstanding would result in three million shares outstanding.
The agent that buys and sells shares on your behalf and earns commission on the value of the transaction.
An order to buy/sell shares when the share price rises to or above/falls to or below a specified stop price. When buying, a Stop order is used to make an investment but only when an upward trend in the share price has been established. When selling, a Stop order is used as protection from a sudden fall in the share price or lock-in profits already made.
Stop order (to sell)
Also known as a Stop Loss order. An order to sell shares when the share price falls to or below a specified stop price. Used to cap the amount you are prepared to lose on a holding.
The price at which a Stop order is triggered. For purchases the stop price acts as a minimum price you will pay if an investment is made and for sales the stop price acts as the maximum price you will receive if a holding is sold.
Financial agreements to exchange securities. Swaps benefit both parties involved in the ‘swap’ and can be based on interest rates, stock indices, currency exchange rates and commodity prices. For example, in an interest rate swap, company A pays a fixed interest rate and company B pays a variable interest rate. Company A believes that interest rates will go down so is happy to ‘swap’ interest rates with company B. The swap also suits company B as they do not want to take the chance that the rate will increase and are looking to lock in their interest payments with a fixed rate. Therefore the ‘swap’ is mutually beneficial to both parties.