Some confusing Terminologies in Stock Market

Stock Market people always use words that common people won’t understand. Listening to those jargon seems like they must be something big and bold but let me just simplify it for you in layman’s term. So that you can never forget these jargons.

1) Top line growth:- It is nothing but the turnover also called as total revenue or in simple language sales.

2) Profit:- After deducting all the expenses, what you get is profit.

Profit is of two types

a) Profit before tax:- Turnover – Expense = PBT

b) And then you pay taxes. So, after paying tax what you get is Profit after tax (PAT)

3) Bottom line growth:- is nothing but Profit after tax (PAT)

4) Face Value:- It is the value that is written on the face of any financial instrument.

5) Long Term Capital Gain (LTCG):- If you buy and hold shares for more than one year and earn a profit by selling the shares, it is known as LTCG.

6) Dividend:- Dividend is the return on investment in shares.

7) Share/Stock Split:- Stock split is an action in which a company divides the face value of its existing shares into a smaller face value because of which the number of shares increases proportionately.

8) Bonus Shares:- Bonus shares are the free shares issued by the company to its existing shareholders.

9) Volume:- Number of shares which are traded on the specific date.

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