what is leverage in stock trading?
144586
I concur with the first 2 responders.  There is however a way you can use leverage without borrowing money. I am reporting this only to complete the answer.  I am not recommending it.  That is to buy calls or puts, especially out of the money calls and puts. It is best illustrated by an example.\n\nDevon Oil trades at say about $62 a share. I am guessing.\nYou can purchase an April call at $65 for $5. Another guess.\nIf Devon goes to $75 before the April expiration your call will be worth $10. You will have doubled your money whereas if you had purchased the stock you would have only increased your money by 21%. That is leverage.  You, however, will have noticed that if Devon does not rise to $70 by the expiration date, you loose money. However, the price swings of options, especially options of volitile stocks such as the oil stocks can be dramatic.  Also the price drop of an option in relation to the price drop of the underlying stock is generally less on options with long expiration dates, but the price rise is generally greater. \n\nLets say you bought the option for $5.00 tomarrow.  During the next five day Devon rises $5.00 a share to $67. That price swing has probably happened a dozen times during the last year. Your option will probably trade at $7.50, a 50% increase in a week. But the stock rose only 8%.
1036623
Generally you're allowed to borrow 75-100% of your account value on margin. It's not always 100% since the stocks might go down in value and the broker protects itself, in case you default on the loan and they have to sell your shares.
415762
Mark to Market (MTM) means to adjust the price of derivatives to its last traded price on the exchange, this is done in order to compute the gain/loss for the day on the open position.
885410
It is the price you give to the broker, to sell the shares automatically, when the market price falls to that level. It prevents your holding from losing any more value. \nHowever it locks in the loss and you lose any gain on recovery.
582846
It means what is the underlying asset used to settle the contract.  So for a stock option that would usually be the cash stock (so GE stock to settle a GE Option).  Occasionally it might be the cash instead.
399507
False.  Leverage means debt.  Debt means ability to generate payments.  If sales are cyclical, there will be some periods where income can easily service payments, but there will also be periods where it will be tough, which leads to the downfall of a business.
320304
Insider trading is using privileged information in order to make a profit on the stock market. For example, if as a part of your job, you work for a multinational company, and you hear through the channels that your company is planning a takeover of a rival company. Such news will generally drive up the price of the shares of the company being taken over. If you were to purchase shares in the rival company, with the plans of selling them after the share price has been driven up once the takeover has been announced, you would be guilty of insider trading. (If you were caught, of course). Penalties can include jail time and heavy fines.
296832
A stock market is a market for the trading of company stock, and derivatives of same; both those securities listed on a stock exchange as well as those only traded privately.\n \nAlthough common, the term 'the stock market' is a somewhat abstract concept for the mechanism that enables the trading of company stocks. It is also used to describe the totality of all stocks, especially within one country, for example in the phrase "the stock market was up today", or in the term "stock market bubble".\n\nIt is distinct from a stock exchange, which is an entity (a corporation or mutual organization) in the business of bringing buyers and sellers of stocks together. For example, 'the stock market' in the United States includes the trading of stocks listed on the NYSE, NASDAQ, and Amex, and also on the OTCBB and Pink Sheets.
189965
warrant - is the right of the holder to buy or sell a certain underlying security at an agreed price.\nStock and share usually refer to the same thing. US called stock, UK called share.
463940
I think you mean gilt*\n\nGilts are bonds issued by some governments, generally we talk about UK gilts. They are a method of financing government debt, sold to the public with a rate of return usually just above the base rate however this will vary depending on supply/demand.\n\nStock/Share\n\nThese are issued by companies which choose to float on the stock market. Companies will sell stock as a 'cheap' way of raising cash. Each stock represents ownership or a 'share' in the company. A typical FTSE 100 company will float billions of shares thus if you buy one share in a company with a float of one billion shares, you own one billionth of that company. The typical reason for buying stocks in a company will be for a return on your investment if you think the company is going to do well or is undervalued.
613972
It's a negative prefix, meaning not, or the opposite of, or to reverse or undo.\n\nIn the stock market, it means "unit shares".
718061
A stock exchange  is a corporation or mutual organization which provides facilities for stock brokers to trade company stocks and other securities. Stock exchanges also provide facilities for the issue and redemption of securities, as well as, other financial instruments and capital events including the payment of income and dividends.
1145611
Ah, you are asking for something magical and unattainable, like drinking from the fountain of everlasting youth.\n   Option trading is a highly leveraged skill.  If there were a firm that was successful at it, they would have exited the "advisory" business and gone into pure options trading itself.\n   The many popular advisors are rolling the dice, but with your money.  I know because they threw too many "snake-eyes" with my money.
1079680
A hedging instrument is a financial position opposit your other financial positions.  For example you own $100,000 worth of BAC stock and you fear the market may go down because the Fed is raising interest rates.  You do not want to sell your $100,000 worth of BAC because it pays a decent dividend but you would like buy some protection against a possible market drop. So you buy a hedge.  In this case it would be perhaps in the form of buying out of the money put for $100,000 worth of BAC stock, say $5.00 below the current price of the stock.  If the stock falls to say $6.00 below the current price you are protected from any further loss.  If it does not then you are out the price of the put.  And you do not necessarily have to sell your stock at the put price because the value of your put rises as the stock falls and you always sell it for a higher price and keep your stock. \n\nAnother way would be to sell a deep in the money call on $100,000 worth of BAC stock.  That way if the price of the stock falls below the price of the call you are protected down to the price of the call but not below.  But in this case it did not cost you anything.  But if BAC does not fall in price, you will loose your BAC stock. \n\nThere are many other ways to hedge your financial position.  But those two are perhaps the easiest to understand.
899497
In financial markets, stock is the capital raised by a corporation through the issuance and distribution of shares.\n\nA person or organization which holds share of stocks is called a shareholder. The aggregate value of a corporation's issued shares is its market capitalization\n\nIn finance a share is a unit of account for various financial instruments including stocks, mutual funds, limited partnerships, and REIT's. In British English, the usage of the word share alone to refer solely to stocks is so common that it almost replaces the word stock itself.\n\nA share is one of a finite number of equal portions in the capital of a company, entitling the owner to a proportion of distributed, non-reinvested profits known as dividends and to a portion of the value of the company in case of liquidation. Shares can be voting or non-voting, meaning they either do or do not carry the right to vote on the board of directors and corporate policy. Whether this right exists often affects the value of the share.
152014
Margin trading is buying stock with someone else's money. Typically, it works like this.\n\nYou put $1000 in a broker's margin account. You can buy up to $1500 in stocks. The extra $500 (50% of your amount) is being loaned to you by the broker. And yes, you will pay interest on that loan.\n\nThe trick is picking stocks that will outperform the interest rate. If the stock goes up, you can greatly increase your income. If it goes down, you lose more also. Plus, if you lose too much, you will have to sell off some of the stock (at a loss) in order to keep yourself with only a certain amount of debt (typically 50%). This is known as a margin call.\n\nHaving tried this, it is tricky. You can make a lot and you can lose a lot. I traded on margin for about a year and did both.
266824
Ok...insider trading is where someone knows things about a company before it is made public and uses this information to profit on the stock exchange. Eg: I know of a company that has just made a major discovery such as a cure for cancer that can be taken in tablet form for 1 week. This will send the share price of this company rocketing. I buy as many shares as possible...then the discovery is announced and share prices skyrocket and I ear lots of money.