Dictionary

A
Allotment of shares	The creation and issuing of shares by a company to people who become its shareholders
Angel Investor	Angel investors often invest directly in smaller startups or entrepreneurs. Often, angel investors are among an entrepreneur's family and friends. The capital angel investors provide may be a one-time investment to help the business propel or an ongoing injection of money to support and carry the company through its difficult early stages. Angel investors are also called informal investors, angel funders, private investors, seed investors or business angels. These are affluent individuals who inject capital for startups in exchange for ownership equity or convertible debt. Some angel investors invest through crowdfunding platforms online or build angel investor networks to pool in capital.
Alternative Investment Market(AIM)	A sub-market of the London Stock Exchange that permits smaller companies to participate with greater regulatory flexibility than applies to the main market, including no set requirements for capitalization or the number of shares issued. The Alternative Investment Market is the London Stock Exchange's global market for smaller and growing companies.
Annual report	Report from a company covering the previous financial (past) year. The financial statements include income statement, balance sheet and annual report.
Annuity	Means a fixed sum of money that is paid to a person each year.
Ask price	The ask price is the lowest price a seller of a stock is willing to accept for a share of that given stock.
B
Balance Sheet	A statement showing the assets and liabilities of a company.
Bid Price	The highest price that a buyer at a given time is willing to pay for a share.
Bill of sale	Bill relating to a purchase of shares.
Blue Chip	High quality companies that are known to weather down turns and invest prudently in the face of adverse economic conditions. They also high an impeccable track record for reputation and success.
Bond fund	Fund with investments in interest-bearing securities of typically longer duration.
Business Angel	Anyone who is an early stage company investor and who often acts as a Board member or provides wider resource to a company.
Business Plan	"... a good business plan can help to make a good business credible, understandable, and attractive to someone who is unfamiliar with the business. Writing a good business plan can’t guarantee success, but it can go a long way toward reducing the odds of failure." BUSINESS PLAN SECTIONS Executive Summary Company Overview Industry Analysis Customer Analysis Competitive Analysis Marketing Plan Operations Plan Management Team Financial Plan Appendix
C
Capital gain/loss	Profit/loss arising on the sale of securities or other assets.
Closing rate	The purchase and selling rates which apply when trading stops for the day..
Comparable Company Analysis	The simplest method of estimating the value of a private company is to use Comparable Company Analysis (CCA). To use this approach, look to the public markets for firms which most closely resemble the private (or listed) target firm and base valuation estimates on the values at which its publicly-traded peers are traded.
Compliance (financial)	Any firm or individual that carries out a regulated financial activity must be authorised by the country in which it is located. What is a regulated activity? Promoting financial investments (shares) Arranging transactions in investments Advising on investments Managing investments
Consolidated statement of income	Shows how a company's results (profit or loss) were incurred during a specific period.
Convertibles	Convertibles are securities, usually bonds or preferred shares, that can be converted into common stock. Convertibles are most often associated with convertible bonds, which allow bond holders to convert their creditor position to that of an equity holder at an agreed-upon price. Other convertible securities can include notes and preferred shares, which can possess many different traits.
D
Distribution	A financial payment paid by a company to its shareholders.
Debenture	A debenture is a type of debt instrument that can be secured or not secured by physical assets or collateral. Unsecured Debentures are backed only by the general creditworthiness and reputation of the issuer. A secured debenture allows the lender a lien on assets of the business or indeed the business itself
E
Earnings per share (V/A)	The Company's profit after tax divided by the number of outstanding shares.
EIS (SEIS)	The Enterprise Investment Scheme (EIS) and The Seed Enterprise Investment Scheme (SEIS) are government initiatives offering attractive tax breaks for citizens living in the UK. EIS&SEIS_Tax reliefs
Exit Strategy	An exit strategy is a contingency plan that is executed by an investor, trader, venture capitalist or business owner to liquidate a position in a financial asset or dispose of tangible business assets once certain predetermined criteria for either has been met or exceeded. An exit strategy may be executed for the purpose of; exiting a non-performing investment closing a business that is not generating profits to limit losses when an investment or business venture has met its profit objective in response to a significant change in market conditions legal reasons, such as estate planning, liability lawsuits or a divorce or for the simple reason that a business owner/investor is retiring and wants to cash out. INVESTMENT EXITS
F
Fair Wind	A nautical expression used by yachtsmen - sailors. If the wind and sea direction are the same a vessel (boat) is "set fair." Therefore with a "fair wind" she will have a smooth ride. A company can therefore be defined as "set fair" or having "a fair wind"
Fiduciary	Means acting as a trustee. A person or institution that is in a position of trust. Having the power of responsibility and administration for third parties.
Financial Year	The period that a company's accounting records cover, usually a calendar year eg January to December.
H
Hedge	A hedge is a method to protect against financial loss. A corporate hedge reduces the risk of adverse price movement in an asset. As a hedge against equities a manager would invest in bonds or gilts. A hedge is an insurance policy in the event of a disaster. To hedge equities is a counter balance as to whether a stock will go up or down. Known as a derivative.
I
Interim Report	Financial report from a company with accounts covering a part of the financial year, normally quarterly or half yearly.
IPO	Initial Public Offering when a company is listed on a public Stock Exchange for the first time. THE IPO PROCESS
Issue Price	The price to be paid for newly issued shares.
Issue	Issue of shares
L
Lien	Means the right to keep possession of an asset belonging to another person until the debt owed by that person is discharged.
Liquid assets	Money or assets that can be readily converted into cash.
M
Market capitalisation	A company's market capitalisation is the share price multiplied by the number of issued shares in the company.
Mezzanine Debt	Mezzanine financing is a hybrid of debt and equity financing that gives the lender the rights to convert to an ownership or equity interest in the company in case of default, after venture capital companies and other senior lenders are paid.
N
NAV-value	The value of a company’s net assets, versus assets less liabilities
New Issue	When a company issues new shares for a cash consideration
Newly issued share	Share obtained by a new share issue.
Nominal value	The par value of a company’s share. A new share cannot be issued as fully paid for less than its nominal value.
Nominated Adviser (NOMAD)	A company that has been approved as a nominated adviser for the Alternative Investment Market (AIM), by the London Stock Exchange. Individuals are not permitted to becoming nominated advisers, and there are certain criteria that must be met by a company before it is approved for membership.
O
Option	An option is a financial derivative that represents a contract sold by one party (the option writer) to another party (the option holder). The contract offers the buyer the right, but not the obligation, to buy (call) or sell (put) a security or other financial asset at an agreed-upon price (the strike price) during a certain period of time or on a specific date (exercise date)
Orderly markets	Is normally imposed by a company's advisers to ensure that (typically) in the period following a listing, there is no disproportionate buying or selling of the company's shares.
P
Preferential Share	Preference shares, more commonly referred to as preferred stock, are shares of a company’s stock with dividends that are paid out to shareholders before common stock dividends are issued. If the company enters bankruptcy, the shareholders with preferred stock are entitled to be paid from company assets first. Most preference shares have a fixed dividend, while common stocks generally do not. Preferred stock shareholders also typically do not hold any voting rights, but common shareholders usually do.
Private Equity	Private equity is composed of funds and investors that directly invest in PRIVATE companies. Institutional and retail investors provide the capital for private equity, and the capital can be utilized to fund new technology, make acquisitions, expand working capital, and to bolster and solidify a balance sheet that ultimately drives accelerated value for its participants.
Project (ABC Specific)	Summary description of companies in an early stage and with a product or service that is not yet on the market. Public Limited Companies (PLC) Form of Business that is characterised by the fact that the shareholders do not have personal responsibility for the company's debts.
Put option	Securities which gives the owner the right (but not the obligation) to sell a given share at a specific price within a certain time.
R
Rate	An evaluation of a corporate bond.
Return on Investment	The profit or running yield on an investment.
Reverse stock split	A corporate action in which a company reduces the total number of its outstanding shares. A reverse stock split involves the company dividing its current shares by a number such as 5 or 10, which would be called a 1-for-5 or 1-for-10 split, respectively. A reverse stock split is the opposite of a conventional (forward) stock split, which increases the number of shares outstanding. Similar to a forward stock split, the reverse split does not add any real value to the company. But since the motivation for a reverse split is very different from that for a forward split, the stock’s price moves after a reverse and forward split may be quite divergent. A reverse stock split is also known as a stock consolidation or share rollback.
Rigths Issue	A rights issue is a dividend of subscription rights to buy additional securities in a company made to the company's existing security holders. When the rights are for equity securities, such as shares, in a public company, it is a non-dilutive pro rata way to raise capital.
S
Sales note	Bill which relates to a sale.
Sales Order	The instructions given in connection with a sale e.g. agreement on share price, highest and lowest price acceptable; these are known as limits.
Securities	Common name for a company’s financial instruments eg shares, bonds, options, etc.
Seed Capital	Seed capital is the initial capital used when starting a business, often coming from the founders' personal assets, friends or family, for covering initial operating expenses and attracting venture capitalists. This type of funding is often obtained in exchange for an equity stake in the enterprise, although with less formal contractual overhead than standard equity financing. Because banks and venture capital investors view seed capital as an "at risk" investment by the promoters of a new venture, capital providers may wait until a business is more established before making larger investments of venture capital funding.
Selling Price	The lowest price that someone is willing to sell a share at a given time.
Share certificate	Document which is evidence of ownership of one or more shares.
Share entitlements	The number of shares that may be due at any time to a shareholder
Share portfolio	The shares that you own.
Share subscription rights	Rights to subscribe for shares in a new share issue.
Share	A share is a holding in a company that is registered in the form of a limited liability company. When you own a share you are a shareholder in that company.
Stock exchange rate	The quoted market price of a currency, bond or security.
Stock Exchange	An organised market for trading in the securities, commodities or currencies.
Stock option	An option that give the holder the right to purchase one share at a predetermined price within a certain time period.
Stock register	Register of all owners of a limited liability company.
Strike price	The predetermined price option holder has the right to buy the underlying commodity.
Strike price adjustments	A valuation review will involve an analysis of identified key strategic milestones including financial performance, market penetration, new contract wins, product delivery, and any other related business deliverables.The review from time to time may result in the Club re-evaluating the strike price of a Company either negatively or positively so as to provide our members with a gauge on Company performance and value. Any adjustment of the strike price is always carefully considered. The Strike Price is determined and agreed between the Company and the Business Club and should be used as a valuation gauge of the Company at the time – this is of course subject to change positively and negatively.
Subscription period	The time period specified during which a shareholder has the right to subscribe for new shares in a rights issue or subscribe for shares in an initial public offering.
Subscription price	The price to be paid for each new share in a new share issue.
SWIFT	Society for Worldwide Interbank Financial Telecommunication. Operates a computerised system for the international money transmission services.
T
Turnover	A company's total sales during a certain period.
V/W
Venture Capitalist	A venture capitalist is an investor who either provides capital to startup ventures or supports small companies that wish to expand but do not have access to equities markets. Venture capitalists are willing to invest in such companies because they can earn a massive return on their investments if these companies are a success.
VP-account	A security paper account where the shareholder's securities are registered. VP-account has replaced the old share certificate.
Vulture Fund	Is a fund that invests in distressed assets.
Warrant	A warrant is a derivative that confers the right, but not the obligation, to buy or sell a security – normally an equity – at a certain price before expiration. The price at which the underlying security can be bought or sold is referred to as the exercise price or strike price. An American warrant can be exercised at any time on or before the expiration date, while European warrants can only be exercised on the expiration date. Warrants that confer the right to buy a security are known as call warrants; those that confer the right to sell are known as put warrants.
Warrant (Exploding)	An equity derivative investment instrument that gives that holder the right, but not the obligation, to acquire the underlying instrument, and which is exercised only if the issuing company does not meet certain specified goals. An exploding warrant becomes exercisable only in the event that the issuing company fails to meet certain goals, such as sales targets, product goals or EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) values. If the specified goals are met, however, the warrant "explodes" and is not exercisable.