Glossary — M

Level up! We have mastered L, now it is time for M!

Market Manipulation

Market manipulation is when an individual or group artificially influences the price of a security (such as a stock, commodity, or currency) for personal gain. This can be done in multiple ways: 1. Spreading false information:

• Releasing misleading news or rumours to affect investor decisions.

2. Wash sales: Buying and selling the

• same security in quick succession to create the appearance of market activity.

3. Bear raids: Short selling to drive

• down prices and then buying back at the lower price.

4. Cornering the market: Buying a

• large portion of available shares to control prices.

Market manipulation is illegal and can lead to severe financial consequences. Manipulation: Definition, Methods, Types, and Example MOVING AVERAGES (MA) Moving Averages (MA) are like a "trend filter" that can help you:

• Identify the direction of the market (up or down).
• Smooth out price fluctuations (noise).
• Make buy and sell decisions.

Here is how it works:

• A MA line follows the price action, but at a slower pace.
• When the price rises above the
• MA, it could be a buy signal.
• When the price falls below the
• MA, it could be a sell signal.

By using MAs, investors can ride the trend and avoid getting caught in short-term fluctuations! Moving Average (MA): Purpose, Uses, Formula, and Examples

Margin

Margin is the amount of money required to buy or sell a financial asset (such as a stock, commodity, or currency) when using borrowed money from a broker. It is like a deposit to cover potential losses. Imagine you are at a trampoline park: You want to do a tricky stunt but you need a safety net to catch you if you fall. That is kind of like margin in trading! Margin is like the safety net that helps you cover potential losses when trading with borrowed money. Just like how the safety net gives you the freedom to try new tricks without worrying about getting hurt, margin gives you the freedom to trade with more flexibility and control. Margin and Margin Trading Explained Plus Advantages and Disadvantages MARKET CAPITALISATION (MARKET CAP) Market capitalisation, or market cap, is the total value of all outstanding shares (The company's stock being held by stockholders) of a company's stock. A simple formula to calculate market capitalisation is: Market Capitalisation = Total Number of Shares Outstanding x Current Market Price of One Share For example: If a company has 1000 shares outstanding and the current market price of one share is $50, the market capitalisation would be: Market Capitalisation = 1000 shares x $50 = $50 000 Think of market capitalisation like a snapshot of a company's overall value at a given time! Market capitalisation is a way to measure the size of a company, and it can give you an idea of its market value and influence. Market Capitalisation: What It Means for Investors

Market Share

Imagine you are at a pizza party with friends, and there are 10 slices of pizza to share. Each friend represents a company, and the slices they take represents their market share. Market share is like the number of pizza slices a company has:

• If you have 3 slices, you have 30% of the pizza (market share).
• If your friend has 2 slices, they have 20% of the pizza (market share).

The company with the most slices (market share) is the market leader! Just like how you want a bigger slice of pizza, companies want a bigger market share to grow and succeed! So, market share is like the pizza party - it shows how much of the market each company has, and who's getting the biggest slice of the action! Market Share: What It Is and the Formula for Calculating It MARKET INDEX A market index is a list of top companies' stocks or shares, combined to show how well a particular part of the stock market is doing. Think of it like a report card for the market! It is like a basket:

• Imagine a basket holding a selection of different fruits (companies)
• The basket's weight (value) changes as the fruits grow or shrink (company performance)
• The basket's overall weight shows how the market is performing

A few examples:

• The S&P 500 (USA) is like a basket of 500 top US companies
• The FTSE 100 (UK) is like a basket of 100 top UK companies
• The JSE Top 40 (South Africa) is like a basket of 40 top SA companies

Market Index: Definition, How Indexing Works, Types, and Examples

Money Market Accounts

Money market accounts are a type of savings account that offers higher interest rates than traditional savings accounts. However, money market accounts typically have higher fees and require a minimum balance or have restrictions on withdrawals. Money Market Account: How It Works and How It Differs From Other Bank Accounts We are now half way through the alphabet! The first half was just a warm-up! Keep shining, you are halfway to investment stardom! Share this post: Categories STIOSTM: Terminology Sign up for blog updates! Join my email list to receive updates and information. Email address

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