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Glossary

Preferred Stock

A type of stock ownership that provides a fixed dividend and has a higher hierarchy in the payment of dividend over common stockholders.

Premium

The complete cost of an option.

Price Action

The fluctuation in value for a security’s price.

Price Weighted Index

A stock index where each stock impacts the value of the index proportionate to it’s price per share.

Price/Earnings Ratio

A company valuation tool that measures current share price against per-share earnings. It’s a good indicator for investor demand for the company’s shares.

Prime Rate

The rate of interest that U.S. banks collect from their best rated customers.

Profit Margin

A corporate evaluative formula that divides Net Income by revenue for a specified period.

Profit Warning

Company announcement indicting that actual profits are likely to be lower than forecasted projections.

Program Trading

Automated trades representing large blocks of securities executed by institutional traders via a computerized platform.

Prospectus

Legal document that provides details about a securities offering to the general public.

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