Glossary

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real-time	-	Without any delay. Some stockbroking systems only allow you to access prices which are delayed - they can be up to 20 minutes behind the actual prices at any moment. With Saga Share Direct you can access real-time prices - the prices at which buying and selling is actually taking place in the market.
record date / books closed date	-	The date on which the registrar of a company physically closes its books for the purpose of distributing a benefit to shareholders. This is not the date at which the entitlement is determined.
redeemable preference	-	Provisions for the redemption of these shares at a predetermined date.
redemption	-	In relation to shares means the purchase back by a company of some of its own shares.
redemption yield	-	Gives a total return on the investment, taking into account the fact that whilst earning interest a capital gain/loss may be made by owning the bond to completion.
registered holder	-	The name that appears on the company register as the holder of the stock.
registrar	-	An organisation that takes responsibility for maintaining a company's share register, which lists the registered holders of the stock.
reinvestment unit trusts	-	These are a sub section of income unit trusts whereby the dividend is utilised by the Fund Managers who purchase additional units, this payment carries an associated tax credit.
retail price index	-	A means to measure inflation based upon the price of a selection of family goods.
return	-	The amount by which your investment increases as a result of interest or dividend income and capital growth.
reverse takeover	-	The process of a smaller company taking over a larger one, or when the company being bought will be the dominant part of the new company.
return on capital employed	-	(ROCE) A calculation to asses profitability, usually expressed as a percentage. (Profit divided by Capital times by 100.)
RIE	-	Recognised Investment Exchange, a status that is achieved once recognised by the FSA.
rights issue	-	The issue of new shares by a company to raise cash, these shares are normally offered to existing shareholders in proportion to their holdings.
risk adjusted performance	-	Gives an indication of the performance taking into account the risk level.
RSP	-	Retail Service Provider. A securities house that provides competing quotes to stockbrokers for their retail customers.
running a book	-	Firms who are buying and selling stock for themselves hoping to profit from price differences are said to run a book in that stock.

SAYE	-	Save As You Earn. Employer run schemes for employees to buy shares in the company.
scaling down	-	When a new issue is oversubscribed, the procedure whereby applicants receive a proportion of the number of shares for which they applied.
scrip dividends	-	Scrips and enhanced scrip dividends - In this instance the company will announce that shares can be offered in lieu of a cash dividend.
scrip issue	-	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.
SEATS	-	Stock Exchange Automated Trading Services. Allows sales and purchases to be matched electronically.
securities	-	The general name given to stocks and shares of all types.
securities house	-	General term for a bank/financial institution that conducts securities investment business.
sector	-	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.
sector average	-	Shows the average of all funds within the same sector.
sector ranking	-	Shows the position of a fund relative to equivalent funds in the same sector.
SEDOL	-	The identification number for investments. SEDOL stands for Stock Exchange Daily Official List.
SETS	-	Stock Exchange Electronic Trading System. Order driven electronic trading system employed to deal in the FTSE 100 and ex FTSE 100 equities.
settlement date	-	The date that any monies outstanding for deals placed needs to be paid by.
share certificates	-	See 'certificate'.
share exchange	-	Facility offered by ISA managers whereby they sell your shares and invest the proceeds in an ISA.
share option	-	The right (but not the obligation) to buy shares at a certain price within a given time frame.
shares	-	Companies divide their capital into equal units called shares. Buying the shares brings rights - a stake in the business- and the risk of losing your investment.
short position	-	Selling shares that are not owned by the individual in hope of being able to buy them back at a cheaper rate.
short termism	-	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
shorts	-	Government securities that will be repaid in less than five years. Also known as a short-dated bond.
six month performance indicators	-	How an investment has performed in the last 6 months.
S&P Ratings	-	Fund management ratings, which are based on both quantitative performance based reviewing and screening and the more qualitative aspect of the fund which looking at the fund manager's track record, his qualifications, the management team etc
S&P Stars	-	These are quantitative performance measures, are based on pure data and mathematics, and measure the extent and consistency of a fund's out-performance relative to its sector. S&P first calculates the fund and sector index performance over each of the preceding 36 months. By dividing each monthly fund performance by its sector index performance, a relative monthly return is reached for each of these months. The higher the average of these 36 months relative returns, the better the fund has done relative to its peers; the more volatile the relative monthly returns are, the less consistent the fund performance is relative to its peers.
specialist sector	-	Specific investment type. Identifies industry sector of specific investment focus, for example Government bonds, commodity shares, smaller companies, index tracking and convertible bonds.
spread	-	The difference between the Bid and the Offer Price.
stag	-	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.
stocks	-	Generally used as another word for equities. Technically, this more accurately refers to fixed interest securities.
stock settlement	-	The warrant holder receives the underlying if the warrant can be exercised profitably at expiry.
stock split	-	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.
stockbroker	-	The agent that buys and sells shares on your behalf and earns commission on the value of the transaction.
stop order	-	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.
stop price	-	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.
strike price	-	The price at which the investor may buy or sell the underlying during (if American style) or at the end (if European style) of the expiry period. Also referred to as 'expiry price' and 'exercise price'. It is known when the warrant is issued.
striking price	-	The price at which the underlying security can be bought or sold.

T+	-	Refers to the settlement period that is allowed once a security has been traded. T+ 5 would mean that settlement will occur five business days after the transaction day.
Talisman	-	The old stock exchange computerised settlement system which was replaced by CREST.
takeover	-	The purchase of one company by another. A takeover can be a friendly acquisition bid where the management would co-operate negotiating the best price, or it could be an unfriendly bid, where the management tries to use various defensive strategies to repel the bidder.
tax year	-	This runs between 6 April and 5 April of the following year and is used for assessment of income tax and capital gains tax.
techMARK	-	All listed technology companies from the FTSE 100 giants to the small are in the techMARK index.
tender offer	-	An offer where potential investors are asked to stipulate the price per share that they are willing to pay.
time spread	-	Option strategy, were an investor buys and sells Put Option and Call Option contracts with the same exercise price but with different expiry dates.
time value	-	The amount by which an option's price exceeds its intrinsic value.
touch	-	The best prices available for a stock on the market, looking at all the market makers.
tracker funds	-	Unit trusts which track the performance of a specific share index. Usually they invest in companies in the same proportion that they make up the index.
trade	-	See 'bargain'.
TradePoint	-	An alternative exchange which is order driven.
traded option	-	A right but not the obligation to buy or sell something at a fixed price at sometime in the future.
trading channels	-	The various channels available to Saga Share Direct clients for placing trades - personal telephone service, the Internet, and post.
trading hours	-	The period of time - Monday to Friday (8.00am to 4.30pm) excluding bank holidays - when orders will generally be accepted.
Trailing Stop order	-	An order to buy/sell shares when the share price rises from its lowest price/falls from its future peak price by a specified number of pence. When buying, a Trailing Stop order is used to make an investment at a price which is relative to the lowest price of the share but only when an upward trend has been established. When selling, a Trailing Stop order is used to maximise the potential profit of a holding by selling relative to the peak price of the shares.
transaction	-	An order to buy or sell a security.
transfer forms	-	Forms needed to transfer ownership of securities from one owner to another.
Treasury	-	The UK Government's finance department.
trusts	-	A trust is a legal device for preserving and protecting assets.
two way price	-	Simultaneous prices in a stock quoted by the market maker, the lower at which they are willing to buy and the higher at which they are willing to sell.

UCITS	-	Undertaking for Collective Investment in Transferable Securities. A type of collective investment (or fund) that allows Financial institutions to operate freely throughout the European Union on the basis of a single authorisation from one member state.
unconditional / wholly unconditional	-	The bidding company making the offer has received acceptances of 90% or more of the shares, and all other criteria have been satisfied.
underlying asset	-	The underlying may be a security (such as shares), a share index (e.g. FTSE 100), a commodity or a currency. Some warrants are based on a 'basket' of underlying assets, which gives an investor exposure to the performance of more than one security.
undersubscribed	-	Circumstances where people have applied for fewer shares than are available in a new issue.
unit	-	Investors purchase units in unit trusts in a similar way to buying shares in companies. The price of a unit is linked directly to the value of the fund's underlying holdings, known as the net asset value (NAV).
unit trusts	-	Open ended investment funds where your money is invested with thousands of others so that you can invest in a greater variety of stock. Each investor owns a unit (or a number of them) the value of which is depends on the value of the assets owned by the trust.
unquoted shares	-	Shares in some companies, most often smaller ones are unquoted or not listed. The reason companies are unquoted is either because they do not want to be listed, preferring to run their business privately, or because they are too small to be listed even on the AIM.

valuation point	-	The time at which the Fund Manager calculates the price of units (unit trusts)/shares (OEICs).
volatility	-	A measure of the amount of movement in the price of a stock.
volume	-	The number of shares traded in a given period.
voting right	-	The rights of shareholders to vote on matters proposed to the owners of the company.

warrant	-	A company may issue warrants to their shareholders, as part of a change in their share capital. They are not shares. Warrants give you the right, but not the obligation to buy shares in the company issuing the warrants, on a fixed date(s), at a fixed price. You can sell your warrants at any time before the fixed date. The value of the warrant is worked out by comparing the fixed price of the warrant against the market price of the shares. Warrants generally do not entitle you to dividends or voting rights.
white knight	-	A company at the receiving end of a takeover bid often searches for an alternative bidder that would be more acceptable - a white knight.
Warrants Risk Warning Notice	-	A two way agreement explaining the potential risks of dealing in warrants.
Windfalls	-	Free shares given to members of a mutual society when it becomes a PLC.

XD	-	See Ex-Dividend.

yield	-	The total annual gross dividend payment divided by the share price, multiplied by 100.

zero-coupon	-	A security that pays no interest, they are sold well below the face value and the investor gets the return in the form of Capital Gains.