John Bonavia is a professional in the field of finance. John loves to follow and play the stock market. He puts a lot of research into any investment he makes, as anyone should. Here he defines some key terms that one who is just getting into the stock market should understand according to investopedia.com

1. Stock Market: The Lingo
According to Investopedia
John Bonavia

2. Stock Market
• The market in which shares of publicly held
companies are issued and traded either
through exchanges or over-the-counter
markets

3. Long
• The buying of a security such as a stock,
commodity or currency, with the expectation
that the asset will rise in value

4. Short
• The sale of a security that is not owned by the seller,
or that the seller has borrowed. Short selling is
motivated by the belief that a security's price will
decline, enabling it to be bought back at a lower
price to make a profit. Short selling may be
prompted by speculation, or by the desire to hedge
the downside risk of a long position in the same
security or a related one. Since the risk of loss on a
short sale is theoretically infinite, short selling should
only be used by experienced traders who are
familiar with its risks.

5. Wash-Sale Rule
• An Internal Revenue Service (IRS) rule that prohibits a
taxpayer from claiming a loss on the sale or trade of a
security in a wash sale. The rule defines a wash sale as
one that occurs when an individual sells or trades a
security at a loss, and within 30 days before or after this
sale, buys a “substantially identical” stock or security, or
acquires a contract or option to do so. A wash sale also
results if an individual sells a security, and the spouse
or a company controlled by the individual buys a
substantially equivalent security.

6. Volume
• The number of shares or contracts traded in
a security or an entire market during a given
period of time. It is simply the amount of
shares that trade hands from sellers to
buyers as a measure of activity. If a buyer of
a stock purchases 100 shares from a seller,
then the volume for that period increases by
100 shares based on that transaction.

7. Quarterly Earnings Report
• A quarterly filing made by public companies
to report their performance. Included in
earnings reports are items such as net
income, earnings per share, earnings from
continuing operations and net sales. These
reports follow the end of each quarter. Most
companies file in January, April, July and
October.

8. Initial Public Offering - IPO
• The first sale of stock by a private company to the
public. IPOs are often issued by smaller, younger
companies seeking the capital to expand, but can also
be done by large privately owned companies looking
to become publicly traded.
• In an IPO, the issuer obtains the assistance of an
underwriting firm, which helps it determine what type
of security to issue (common or preferred), the best
offering price and the time to bring it to market.

9. Limit Order
• An order placed with a brokerage to buy or
sell a set number of shares at a specified
price or better. Because the limit order is not a
market order, it may not be executed if the
price set by the investor cannot be met during
the period of time in which the order is left
open. Limit orders also allow an investor to
limit the length of time an order can be
outstanding before being canceled.

10. Exchange-Traded Fund (ETF)
• An ETF, or exchange traded fund, is a marketable security that
tracks an index, a commodity, bonds, or a basket of assets like
an index fund. Unlike mutual funds, an ETF trades like a
common stock on a stock exchange. ETFs experience price
changes throughout the day as they are bought and sold. ETFs
typically have higher daily liquidity and lower fees than mutual
fund shares, making them an attractive alternative for
individual investors.
• Because it trades like a stock, an ETF does not have its net
asset value (NAV) calculated once at the end of every day like
a mutual fund does.