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Glossary of Stock Investing Terms: I




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This article is from the Glossary of Stock Investing Terms.

Glossary of Stock Investing Terms: I

  • Income statement:

    A company's financial statement summarizing revenues and expenses in a specific period, also known as a profit and loss statement.

  • Indicated dividend:

    The total dividends that would be paid on a share of stock in the next twelve months if each dividend is the same amount as the latest payment.

  • Indicated yield:

    The yield that a share of stock would return based on its current indicated dividend, calculated by dividing the indicated dividend by the current share price.

  • Individual retirement account:

    Known as an IRA. A special retirement planning account for individuals. IRA's currently allow an annual contribution of 100% of earned income up to a maximum of $2,000. All or part of the contribution may be deductible from current taxes, depending on the individual's income and coverage by an employer-sponsored qualified retirement plan (like a 401k plan). Eventual withdrawals of tax deferred contributions are taxed as income, including the capital gains.

  • Industry:

    One of any number of categories used to describe a company's primary business activity, usually determined by largest source of a company's revenues. Can be broad (such as Consumer Cyclical companies), or specific (quick-service hamburger restaurants), or some category in between.

  • Initial public offering:

    Known as an IPO. The first sale of stock by a company to the public. IPOs are often smaller, newer companies seeking equity capital to expand their businesses.

  • Insider:

    Any person who has or has access to relevant non-public information about a company, including directors, officers and any stockholder who owns more than 10% of a corporation.

  • Insider information:

    Information about a company's activities that has not been disclosed to the general public. It is illegal for anyone with access to such information to make trades based on it.

  • Insider trading:

    Illegal trading by anyone considered an insider who has access to non-public information, and who attempts to profit from that knowledge.

  • Inventory:

    Included on a company's balance sheet. Inventory can be raw materials, items already available for sale or in the process of being manufactured.

  • Inventory turnover :

    The ratio of annual sales to inventory. Low turnover may indicate excess inventory or poor sales -- not a good sign.

  • Investment trust:

    Commonly known as a closed-end fund. Closed-end funds invest in other securities (like a mutual fund) but have a fixed number of shares and are traded similarly to stocks. The market price may exceed the net asset value (NAV) per share, in which case the fund is selling at a "premium." When the market price falls below the NAV, the fund is selling at a "discount."

 

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