This amount represents all the money that company has to receive from its customers for the services it has provided or goods it has sold.

A qualified person or an entity that is qualified and licensed to comment or issue a report about a public listed company or economy for the general public.

An asset is a useful and valuable resource that a company owns and it can be sold and converted to cash.

This is a summary of money flowing in and out of a country. If a country is spending more for imported goods and services than it receives for goods and services it exports, a deficit results. If the country received more money by selling goods, services and other payments in foreign markets than it spent on imports and other outgoing payments, it would result in a surplus.

One hundredth of a percentage point (0.01%). Basis points are mainly used to describe the difference between two percentages.

Beta is a measure of a stock’s risk in relation to the market. A BETA of 0.7 for a stock means that a stock price is likely to move up or down 70 % of the market change; while a BETA of 1.3 means the stock is likely to move up or down 30 % more than the market.

A steep and rapid increase in prices that immediately followed by a steep and rapid drop in price. This is an indicator seen in charts and used in technical analysis of stock price and market trends.

A broker is an individual or firm that acts as an intermediary between an investor and a stock exchange. Brokerage firms are financial institutions that help you buy and sell securities. They act as the middleman between the buyer and the seller

Compounding is when you reinvest the earnings that you just received from your previous investment to generate more earnings.

The depository system handles the electronic (paperless) settlement of shares on the stock exchanges. Electronic book entry means that the shares do not physically get traded and the transfer from one client account to another takes place electronically. In Pakistan the depository company is called the Central Depository Company of Pakistan (CDC).

A capital expenditure is money that is spent to buy, repair or improve a company asset such as building, equipment etc.

When an investment is sold for less than it’s original price, it leads to a capital loss. 

A confidence indicator is a measure of an investor’s faith in the economy and the securities market. A measure of the willingness of investors to attempt higher returns by assuming more risk. A low or deteriorating level of confidence is considered by many technical analysts as a negative sign.

A dividend paid in cash to a company’s shareholders.A cash dividend is a payment made by a company out of its earnings to investors in the form of cash

To corner a market means acquiring enough shares to gain control of the whole supply of a particular share to manipulate its share price.

It is the increase in value of one currency compared to another.

These are debts that the company needs to pay within one year, ideally with cash. Common examples are money owed to vendors, utilities, employees’ wages, and dividend payments

Deflation occurs when a sustained period of falling prices takes place/ it is a general decline in prices for goods and services

A dividend is a reward, given to investors from the company profits. It is a return on the investment made by an individual

Depreciation is an accounting method of expensing the cost of a physical asset over its useful life to account for its decline in value. You may think of depreciation as something that happens to your car as it loses value.

Earnings reflect the amount of profit that a company produces during a specific period.

This category is the company’s property, plant, and equipment. The account includes long-lived assets, such as a car, land, buildings, office equipment, and computers.

The currency of an overseas country used for exchanging with local currency.

Financing refers to the process of acquiring capital to fund a start-up, an expansion, basic operations, or whatever else the company needs the extra funds for. The financing activities cash flows section covers these types of activities.

How well the company is performing in the current scenario and how well it will grow in the future, A new and small company may have a lagging revenue but it is expected to have a higher growth trajectory than an already well-established business 

This is the value of total sales without deducting any returns or discounts.

This typically represents the combined annual rate of growth of a company’s revenues, earnings, dividends and even macro concepts – such as the economy as a whole.

Inflation is a general rise in the prices of most goods and services. On average, the inflation rate for Pakistan is approximately 8%. This means that Sugar that can be bought in PKR 100 today, would cost PKR 108 next year and so on depending on the inflation rate.

Any cash flow changes that result from the purchase or sale of investment assets belong in the investing activities cash flows portion of the statement of cash flows. Whenever a company purchases or sells any form of investment, including large, long-term assets, the cash flows result in either a gain or loss in cash from the total cash and cash equivalents (although they could also break even)

Initial public offering is the process by which a private company can go public by sale of its stocks to the general public.

A large, and many times unexpected, financial gain. It is any sum of money you did not expect to receive as part of your regular income.

Inflation is a general rise in prices of goods and services.

It is a ratio indicating how many times a company has sold and replaced inventory during a given period.

Income is the return a business earns from selling its goods and services or the money an individual receives in compensation for his or her labor, services, or investments

In a long (buy) position, the investor is hoping for the price to rise. An investor in a long position will profit from a rise in price. The buying of a security such as a stock, commodity or currency, with the expectation that the asset will rise in value, or in other words a position which gives profit from an increase in price is called Long Position.

Leverage also refers to the amount of debt used to finance a firm’s assets. A firm with significantly more debt than equity is considered to be highly leveraged.

It is an account in which stocks can be purchased for a combination of cash and a loan. A margin account allows you to invest in stock by borrowing money against the securities in the account. Because you can borrow in a margin account, you have to be qualified and approved by the broker.

The maturity date refers to the date when an investment becomes due and is repaid to the investor.

The amount of money something would bring if it was sold. It is commonly understood as the worth in cash that something has within the market.

A mutual fund is a way to invest in things like stocks and bonds, but without the research and risk involved with choosing individual investments.  With a mutual fund, your money is pooled with money from other investors and is then managed professionally, for a fee.

The income earned by a business which are outside of it’s main/core operations.These can be the sale of assets, investment windfalls, the money awarded through litigation, and many more

This is the value of sales after deducting any returns or discounts.

The indirect costs associated with producing goods and services. They are operational expenses that the company bears to keep the business going.

Prepaids are any expense the business pays for in advance, such as rent, insurance, office supplies, postage, travel expense, or advances to employees. They also list as current assets, as long as the company envisions receiving the benefit of the prepaid items within 12 months of the balance sheet date.

A specific type of time-related order, a day order is an order to buy or sell a share that expires at the end of that particular trading day.

A public company is a company that has sold all or part of its ownership to the public and is listed on the stock exchange.

A stock’s price movement over the past year as compared to a market index. Value below 1.0 means the stock shows relative weakness in price movement (underperformed the market); a value above 1.0 means the stock shows relative strength over the 1-year period.

Profit is the amount of money made by a business that is more than the amount paid out as expenses/more than the amount it has spent.

Sum of direct benefits (such as salary, allowances, bonus, and commission) and indirect benefits (such as insurance, pension plans, vacations) that an employee receives from an employer

A risk averse investor is an investor who prefers avoiding loss over making a gain. They tend to avoid risk as much as possible.

A Risk Profile is the level of the risk that you are comfortable with. It is important to identify the risk profile of an individual to determine the nature of investment that will suit them.

It is what is left from your income after you have spent it on your needs and wants. The leftover money that you plan to keep aside ‘safe’ for the future; either in a savings account, under the bed, inside a locker, or in a piggy bank.

When a company has already traded its shares via IPO and still requires money, the shares are traded through a Secondary Public Offering.

Securities Exchange Commission of Pakistan(SECP) keeps check and balance on the overall process of the stock exchange, making sure that all rules and regulations are being followed.

A share repurchase, or buyback, is a decision by a company to buy back its own shares from the marketplace.

These are the company’s earnings which are not given out in the form of dividends but are converted into free shares

The difference between the two prices. the spread is the gap between the bid and the ask prices of

A tick is an upward or downward price change. A tick indicator/index compares the number of shares whose prices are increasing with the number of shares whose prices are decreasing on the stock exchange.

A verbal (or electronic) transaction involving one party buying a security from another party is called Trade.

Treasury bill is a form of bond, issued electronically with a maturity of one year or less. The investor gets the full amount of the bill when the bill matures.

The amount of time during which something is in good enough condition to be used or generate income.

It is the degree of change that happens rapidly and unpredictably. As volatility increases, the potential to make more money quickly also increases. However, higher volatility also means higher risk.

A business may have a warranty policy, under which it promises customers to repair or replace certain types of damage to its products within a certain number of days following the sale date.

The items that company has purchased or services that company has received from the vendors but have not paid for it is called accrued expenses. It is a type of liability.

An Annual Report is the yearly record of a company’s financial condition that includes a description of the firm’s operations, its balance sheet and income statement. accrued expenses. It is a type of liability.

This can be described as the average length of time it takes for a security to mature. A bond’s maturity date is a specified date in the future on which the principal amount (the amount borrowed) becomes due for repayment.

The balance sheet iis a snapshot of your business’s financial health as of a particular date. The balance sheet should show that your company’s assets are equal to the value of your liabilities and your equity. It uses the formula Assets = Liabilities + Equity.

An investor who is optimistic and who thinks prices will rise. A bull market is a prolonged period of rising stock prices.                            

Bonds are a loan from you to a company or government. By buying a bond, you are giving a loan and in return you get interest payments along the way as well as the actual amount at the end of a specified period.

An investor who believes a stock or the overall market will decline. A bear market is a prolonged period of falling stock prices, usually by 20% or more.

The act of buying all or part of a company from the people who own it.

This is the profit that an investor gains from the sale of an asset. It is the difference between the sale price and original cost of an asset.

The assets that can be converted into liquid cash immediately are regarded as cash equivalents. Usually this includes bank accounts and government bonds/ Cash equivalents are the total value of cash on hand that includes items that are similar to cash; cash and cash equivalents must be current assets.

The movement of money in and out of the business. Cash received represents inflows, while money spent represents outflows

In trading, circuit breakers are emergency measures established by stock markets that shut down trading activity temporarily or for the rest of the trading day when market prices drop significantly.

This is the indicator of the change in prices of goods and services. Consumer prices are important because consumer buying drives the economy. No consumer demand at the retail level means no demand for products along with the other steps in the chain of manufacturers, wholesalers, and retailers.

It is also called Cost of Goods Sold (COGS), is the direct cost associated with producing goods and services sold by a company.

This is the interest rate charged by the lender to the borrower on fixed income securities like bonds.

A counterparty is any other participants in a transaction.

Current assets are ones the company expects to convert to cash or use in the business within one year of the balance sheet date.

Deferred tax is a non-cash expense and simply means a tax that is payable in future.

Debt is anything owed by one person to another.

The money invested in a business by the owners without taking any loans is called Equity. This is the investment of the owners in the business and the income earned by it, which is reduced by any amount paid out to the owners

All the costs a business has to incur to keep their business operational/running. Most common examples include telephone, electricity etc.

A Person or a firm who buys and sells foreign currencies to make a profit or acts on behalf of customers to meet their needs of foreign currencies

It is an agreement between two people to exchange certain kinds of financial products for money.

These are assets that do not have a tangible physical form such as property and derive their value from a contractual claim of what they represent.

Gross national product, or GNP, is the total value of the goods and services produced by a country’s economy during a specific period of time, usually a year. It includes all economic production by a country’s people or its companies whether the production takes place within the country or in another country.

It is the total value of goods and services produced in a country. It is a measure used to evaluate the health of a country’s economy.

A holding company is a type of company that owns a controlling interest in another company or companies, controlling their management policies and decisions.Mostly, a holding company does not conduct any day-to-day operations or activities such as producing goods or providing services

The act of investing which basically refers to putting money in buying those financial assets that can potentially give a profit to the person who has invested. There are multiple ways and options to invest, including but not limited to, stocks, commodities, precious metals, forex, crypto currencies and so on and so forth.

The income statement summarizes your company’s financial transactions for a particular time period, such as a month, quarter, or year. It starts with your revenues and then subtracts the costs of goods sold and any expenses incurred in operating the business. The bottom line of the income statement shows how much profit (or loss) the company made during the accounting period.

It is a category of business that describes a company’s primary line of business. This usually is determined by the largest contribution towards the revenue of the company.

Any information that can have an effect on the price of the share of a company and that has not yet been made public.

This is the amount/fee an individual is charged with for borrowing money. It is expressed as a percentage of  the total amount of loan.

The act of investment refers to putting out money to gain a profit.

Goods available for sale reflect on a merchandiser’s balance sheet in this account. A merchandiser is a retail business, like your neighborhood grocery store, that sells to the general public. For a manufacturing company, a business that makes the items merchandisers sell, this category also includes the raw materials used to make items. For companies: Raw materials, items available for sale or in the process of being made ready for sale.

Any money a business must pay out for more than 12 months in the future is considered a long-term liability. Long-term liabilities don’t throw a company into bankruptcy, but if they become too large, the company may have trouble paying its bills in the future. Amount owed by a company for loans, leases, bond repayment and other liabilities due for payment after 1 year.

An order to a broker to buy a specified quantity of a security at or below a specified price or to sell it at or above a specified price (called the limit price)

A margin call refers specifically to a broker’s demand that an investor deposit additional money or securities into the account so that it is brought up to the minimum value, known as the maintenance margin.

Macro variables refer to those factors that affect the overall market and national economy. These factors indirectly affect the price of a company’s share.

This is the total amount of available money and credit in a country. The Central Bank attempts to control money and credit to create a stable, growing economy.

The client’s instruction to a broker to buy or sell the item immediately, at the current best price available is called Market order

Transactions executed in the stock exchanges are registered with clearing and settlement companies where the final execution of a trade takes place. In this way it reduces the risk of one or more parties failing to meet the terms of the agreement.

The amount a business earns after deducting all operating, interest, and tax expenses.

The first buyer of a newly issued security buys that security in the primary market. All subsequent trading of those securities is done in the secondary market.

A stock exchange is a platform where shares can be publicly traded. For Pakistan, there is only one stock exchange called PSX, Pakistan Stock Exchange, where the shares of public listed companies are bought and sold daily.

A private company is owned by the company’s founders and is not listed on the stock exchange,

Quotations refer to the most recent sale price of a stock, bond, or any other asset traded.

Risk is a possibility of either losing the profit or investment or both. You could lose the profit or invested amount because of the businesses not being able to generate revenue due to various market conditions. And Risk Profile in investment refers to the level of risk a person is willing to take.

In financial terms, risk is the chance that an investor is willing to take for a gain from an investment. Risk is a possibility of either losing the profit or investment or both

The issuance of “rights” to existing shareholders allowing them to purchase additional shares, usually at a discount to market price is known as Rights Offering.

Risk averse investor is an investor who is willing to accept a low level of return on their investment.


A risk-free rate means the guaranteed return of an investment with no risk of loss.

A market that provides for the purchase or sale of previously owned securities. Most trading is done in the secondary market. The Stock Exchanges and the bond markets, etc., are examples of secondary markets.

This is the process of setting aside a portion of your income for future use. It is the  the leftover money that you plan to keep aside ‘safe’ for the future

It is the date on which payment is made to settle trade and the buyer must make payment to the seller while the seller delivers the assets to the buyer.

A security is a financial instrument that holds a monetary value and can be traded.

Shares are the units of the ownership of a company, usually traded on the stock market.

The time value of the money you have now is not the same as it will be years from now and vice versa.

Market turnover indicates how much trading activity took place on a given business day in the market as a whole or individual stock. Turnover can be represented in two ways, traded value in rupees and traded volume in number of trades.

It is the date on which a trade occurs.

The difference between the high and low price of a share traded

Variable costs increase or decrease depending on a company’s production or sales volume—they rise as production increases and fall as production decreases.

A share warrant represents the right to buy a share at a specific price on a specific date. It is issued by the company directly to the investor. It is a long term option to buy a share at a fixed price.

The annual return paid on a share in the form of dividends, or the interest paid on a bond or a note.