A FIT INVESTOR IS A KNOWLEDGABLE INVESTOR!

 

F.I.T. DEFINITIONS

 

Annual Earnings: 

An indicator of a companies growth for a particular year.

Average Daily Volume:

The average number of shares traded over a certain time period of trading days, usually 50.

Base:

A term used by Technical Analysts to refer to an area of consolidation in a stock's chart pattern. Common base patterns include the Cup with Handle, Flat Base and Double Bottom.

Bid & Ask:

The price at which a stock can be bought or sold.

Breakout:

A technical analysis term used when a stock breaks up through a former point of resistance or breaks down through a former point of support.

Correction:

A decline in a stock or the general market after a recent uptrend.

Cup and Handle:

A pattern seen on a stock chart that resembles a cup with a handle when viewed from the side.

Distribution:

The selling of a stock on large volume.

Double Bottom:

A stock chart pattern that looks like a " W ".

Earnings:

A basic measurement of a companies ability to make a net profit and grow.

Earnings Per Share:

A company's total after tax profits divided by the number of common shares outstanding.  Used as an indicator of profitability and growth.

Flat Base:

When a stocks price trades within a tight range for a period of five weeks or more.

Fundamental Analysis:

The process of evaluating a company's numbers, products, management, and industry to determine its attractiveness and financial condition.

Growth Stocks:

The stock of a company that is growing earnings and revenue faster than the industry or the overall market.

Institutional Investors:

The big money. Mutual funds, banks, pension funds, and insurance companies tend to drive the volume in the overall market and individual stocks.

Limit Order:

An order to buy or sell a stock at a specific price.

Moving Average:

The average price or volume of a stock over a certain period of time.

Pivot Point or Buy Point:

This is the best possible buy point of a stock as it breaks out of a proper base pattern.

Rally:

When the general markets or a stock begin to advance in price following a period of decline.

Resistance:

In technical analysis, this term represents the inability of the stock price to rise above a certain level. Think of a ceiling.

Stop Order:

An order to buy or sell a security at a predetermined price set by the investor.

Support:

In technical analysis, this term represents the inability for the stock price to break below a certain level. Think of a floor.

Technical Analysis:

The study of a stock or the general market's price patterns and volume through the use of charts.

Volume:

The number of stock shares traded during market hours.