Jargon Buster – 770

1st January 1999

 

Bid-offer spread

The difference between the buying price and the selling price, you always have to pay more than you can sell it for! 

Coppock indicator

A technical analysis tool with an excellent track record of identifying when to buy and when you missed the boat.  

Investment guru Peter Temple, here on iii.co.uk, talks you through using the Coppock Indicator to signal the start of a bull market; even though he admits to never knowingly using it himself.

Corporate bonds

IOU's issued by companies that hopefully will be able to afford the interest and final repayment.

Correction

A short term setback in share prices of between 10% and 20% which causes sleepless nights

As demonstrated by this amusing video on youtube

Death Cross

It sounds like something out of the Pirates of the Caribbean, but in reality it refers to a pattern on the chart where the 50 day moving average crosses below the 200 day moving average to signify the start of a new downtrend. That's all….

Deflation

A persistent fall in the general price level, which your boss might argue is a good reason for cutting your pay. Check out this research from The Economist

Diversification

Don't put all your eggs in one basket, unless you like scrambled eggs or omelette for that matter.

Double Death Cross

Double trouble (see above)

Fundamental analysis

Putting your faith in the facts and figures – a painstaking pastime that often makes you wonder why you bothered.

Here's the Wikipedia entry on fundamental analysis

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