Product / market fit describes the phenomenon of consumption growing perfectly with production. In other words, as it is commonly explained, “customers buy your product as fast as you can make it.”
Category: Terminology
Definitions and explanations of various finance-related terms and concepts!
Short-selling, or simply shorting, is a strategy employed when you believe that the value of some stock will fall. You begin by borrowing a certain number of shares from someone. Then, you sell the shares and buy them back at a lower price-point. Now, you have the same number of shares as before (which you then return to the original owner) as well as cash equivalent to the difference between the price when you borrowed and returned the shares. Shorting is used commonly to bet against a company.
Private Equity funds invest directly in companies that are not listed on public exchanges. They may also execute takeovers of publicly-listed firms and delist them, making them private.
High-frequency Trading or HFT uses powerful computing systems and complex algorithms to detect small variations in asset prices and then conducts trades at high volume in a fraction of a second.HFT accounts for about half of all trades made in equity markets. High-frequency traders trade billions of shares per day.
A stock exchange is a medium through which traders can buy and sell financial instruments, including stocks, bonds, and derivatives. The New York Stock Exchange is one of the most prominent exchanges. Trades occur both online and physically.
A unicorn is a start-up valued at over $1 billion.
A value proposition is used by a company to convey why they deserve customers’ business. It highlights how the company adds value for the customer.
A ticker symbol or stock symbol is an identifier for some publicly traded stock, typically consisting of four or fewer letters. For example, Apple’s ticker symbol is AAPL while Ford’s ticker symbol is F.
“Trading on margin” describes the practice of using money borrowed from a broker to purchase some security.The security serves as collateral, and you are required to pay interest on the funds you borrow, as with all loans.
A rally occurs when the price of some stock or the market as a whole increases significantly for a sustained period of time.
