List of Glossary Terms

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Numeric


EAO
This is an order handed down by a court in terms of which an amount may be deducted from an employee's income for the repayment of a creditor. Thousands of salary-earners have EAOs against their... read more
 
EARLY ENTRY
A large price movement in one direction within the first 15 minutes after the open of the daily session.
 
EARMARKING
The setting aside of funds by an organisation or individual for a specific purpose. In the context of government expenditure, funds collected from a specific source can be earmarked to be spent... read more
 
EARNINGS
The earnings of a company are its profits. They are calculated by deducting the expenses of a period from the incomes of the same period. Earnings in South Africa are subject to taxation at 28%.... read more
 
EARNINGS BEFORE INTEREST AND TAXATION
This earnings figure, better known as EBIT, shows the company's earnings before the cost of interest-bearing debt and taxation. It does not exclude the cost of assets (depreciation) or impairments... read more
 
EARNINGS BEFORE INTEREST, TAXATION, DEPRECIATION AND AMORTISATION
This is shortened to EBITDA and it shows the company's profits before non-operational costs. This allows investors to see the company's operating performance. Some companies express the gearing... read more
 
EARNINGS ESTIMATES
The estimated earnings projected for a company for a fiscal year. Estimating future earnings is an art. It depends on both internal factors within the company such as working capital management,... read more
 
EARNINGS MULTIPLE
The market price of a share divided by its most recent average annual earnings per share. This gives the reciprocal of the "earnings yield", and is used by some investors to compare shares with... read more
 
EARNINGS PER SHARE
A company's earnings (profit) divided by the number of ordinary shares usually expressed as a number of cents per share. The earnings per share (EPS) includes all the companies incomes and expenses... read more
 
EARNINGS YIELD
Earnings per share expressed as a percentage of the current market price of the share. For example, a company with 25 cents earnings per share and a market price of 250 cents would have an earnings... read more
 
EBIT
This earnings figure, better known as EBIT, shows the company's earnings before the cost of interest-bearing debt and taxation. It does not exclude the cost of assets (depreciation) or impairments... read more
 
EBITDA
This is shortened to EBITDA and it shows the company's profits before non-operational costs. This allows investors to see the company's operating performance. Some companies express the gearing... read more
 
ECB
The Central Bank for the European Union.
 
ECONOMETRICS
This is the application of statistics and probability to economic data. Like all social sciences, economics is measuring the behaviour of people and developing rules based on their behavioural... read more
 
ECONOMIC CONTRACTION
A cyclical period of lower economic activity, occurring at regular intervals; as opposed to a depression, which is a period of major economic downturn with high unemployment and declining gross... read more
 
ECONOMIC GROWTH
In the context of economics, this refers to the increase in a country's gross domestic product (GDP). GDP growth is impacted by many things, but mainly by consumer spending which, in South Africa,... read more
 
ECONOMIC INDICATORS
Every week there are a variety of economic indicators which are published. The Business Day runs a special column on Mondays explaining which indicators are going to be published that week and... read more
 
ECONOMIC SANCTIONS
Economic penalties which are imposed on one country, organisation or individual by one or more countries with the objective of getting that country, organisation or individual to change their... read more
 
ECONOMIC STIMULUS
A mechanism to encourage economic activity within the economy. The Monetary Policy Committee (MPC) meets every two months to decide whether to reduce interest rates, increase them or leave them... read more
 
ECONOMICS
The study of the allocation of scarce resources within a country and between countries. Economics is a social science because it looks at human behaviour and how people make financial decisions.... read more
 
ECONOMIES OF SCALE
Achieving economies of scale is the objective of every manufacturing business, because it substantially reduces costs and increases profitability. There is a distinct advantage to size in manufacturing,... read more
 
ECONOMY
The economy of a country is the aggregate of all economic activity within that country. It is measured in various ways to determine whether it is growing or shrinking. The most commonly used... read more
 
ECS
03 - 09 - 2020
Ecsponent (ECS) is a penny stock, listed in the venture capital fledgling sector of the JSE. The company presents itself as a financial services group with operations in Botswana,... read more
 
EEL
01 - 09 - 2020
Efora Energy (EEL) is an African oil and gas company incorporated in 1993 and listed on the JSE in October 1994. The company is involved in numerous projects from oil production... read more
 
EFFECTIVE INTEREST RATE
The interest coupon on a bond expressed as a percentage of its current price. Thus, a R1m bond with a coupon of 10% would earn R100 000 per annum, but if the price of the bond falls to R900 000... read more
 
EFFECTIVE TAXATION RATE
This is the percentage of its taxable income that a company pays to the Receiver. The Income Tax Act allows companies to deduct certain initial and investment allowances when they purchase capital... read more
 
EFFICIENT MARKET
The basis of modern portfolio theory, the efficient market hypothesis, maintains that all information is already discounted by the market and reflected in share prices due to market participants... read more
 
EFFICIENT MARKET THEORY
The basis of modern portfolio theory, the efficient market hypothesis, maintains that all information is already discounted by the market and reflected in share prices due to market participants... read more
 
EFG
25 - 11 - 2019
The Efficient Group (EFG) is an asset management and financial services group managed by well-known economist, Dawie Roodt (who is also a 5,7% shareholder). It is involved... read more
 
EIA
The EIA describes itself as, "The U.S. Energy Information Administration (EIA) collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking,... read more
 
ELASTICITY
  1. The ability to recover an original configuration.
  2. The elasticity of demand or supply refers to the degree to which demand or supply responds to changes in price. For example,... read more
 
ELECTRONIC ORDER
An order placed electronically (without the use of a broker) either via the Internet or an electronic trading system.
 
ELECTRONIC SCRIP REGISTER
After dematerialisation in South Africa, physical share certificates were replaced by an electronic record and share registers were replaced by an electronic scrip register. Obviously, the electronic... read more
 
ELECTRONIC SETTLEMENT
Settlement of securities transactions on a T+3 rolling contractual settlement cycle through STRATE, the electronic settlement system.
 
ELECTRONIC TRADING HOURS
The U.S. after-hours markets during the evenings. Futures contracts trading during ETH do so on electronic trade matching platforms such as Globex or A/C/E.
 
ELECTRONIC TRADING SYSTEMS
Systems that allow participating exchanges to list their products for trading after the close of the exchange's open outcry trading hours (i.e., Chicago Board of Trade's A/C/E, Chicago Mercantile... read more
 
ELI
02 - 10 - 2020
Ellies (ELI) is a fledgling electronics company which imports and distributes electrical products and supplies solar power solutions. From its heyday in 2013 when the share... read more
 
ELLIOT IMPULSE WAVE
The strong moves in Elliot Wave theory which move in the direction of the larger degree wave. In Elliot Wave theory there ware two types of waves: impulse and corrective. Impulse waves are the... read more
 
ELLIOTT WAVE
A pattern-recognition technique published by Ralph Nelson Elliott in 1939, which holds that the stock market follows a rhythm or pattern of five waves up and three waves down to form a complete... read more
 
ELLIOTT WAVE THEORY
A pattern-recognition technique published by Ralph Nelson Elliott in 1939, which holds that the stock market follows a rhythm or pattern of five waves up and three waves down to form a complete... read more
 
ELR
08 - 09 - 2020
The Elb Group Limited (ELR), formally Edward L Bateman, is an engineering and construction company that is involved in materials handling, minerals separation, power solutions... read more
 
EMBEDDED DERIVATIVE
This is a derivatives contract that is made part of a commercial agreement. The idea is that the derivative contract only comes into play if and when, certain conditions are met. The objective... read more
 
EMBEDDED VALUE
Thi is an insurance term which means the current value of future earnings plus net asset value (NAV). Embedded value approximates the value of the shareholder's interest in the company - and... read more
 
EME
An exempted micro enterprise (EME) is a small business in South Africa that is exmpted from the requirements of the Broad Based Balck Economic Empowerment Act (53 of 2003) because of its small... read more
 
EMERGING MARKET
An economy which is in a development phase - as opposed to a first-world economy which is said to be fully developed. Emerging economies generally enjoy more rapid growth than first world economies,... read more
 
EMERGING MARKETS INDEX
An average index of the stock markets of emerging economies produced and maintained by Morgan Stanley Capital International (MSCI). It is weighted 40,95% China, 12,28% Taiwan, 11,61% Korea, 8,02%... read more
 
EMH
26 - 05 - 2020
E-Media Holdings (EMH) owns 67,7% of E-Media Investments which in turn runs ETV and E-News as well as other smaller operations. This company is investing heavily into multi-channel... read more
 
EMI
01 - 09- 2020
Emira Property (EMI) is a real estate investment trust (REIT) which has substantial exposure to the South African economy through its office properties. It owns 79 properties... read more
 
EMOLUMENTS ATTACHMENTS ORDER
This is an order handed down by a court in terms of which an amount may be deducted from an employee's income for the repayment of a creditor. Thousands of salary-earners have EAOs against their... read more
 
EMPHASIS OF MATTER
An audit opinion which is specifically meant to draw attention to a particular point in the financials. Listed companies which have an emphasis of matter are marked with the letter "E" by the... read more
 
EMPLOYEE
A person who exchanges their time and skill for a salary or wage. Labour is one of the four factors of production and every adult can engage in employment to earn their living. The more highly... read more
 
EMPLOYEE SHARE INCENTIVE SCHEME
Most listed companies use their shares to motivate their employees through an employee share option scheme. This usually involves the employee getting options to buy a certain quantity of shares... read more
 
EMPLOYMENT EQUITY ACT
This Act is aimed at redressing the wrongs of the Apartheid era and ensuring that employment is not racially based. It does this by trying to ensure that companies above a certain size (with... read more
 
EMPLOYMENT TAX INCENTIVE ACT
An Act designed to incentivise employers to employ young people in the economy. The Employment Tax Incentive Act (26 of 2013), which is also called the Youth Employment Tax Incentive,... read more
 
ENCUMBERED
The word "encumbered" is applied to assets which are bonded or otherwise used as security to cover a loan.
 
END OF DAY PRICE
This is  closing price of a share at the end of the trading day. Most software available to private investors makes use of end of day data. The JSE provides a feed of such data for a royalty... read more
 
ENDOWMENT
An endowment insurance policy is a type of savings/investment. A pure endowment offers no risk or term insurance. The problem with these policies is that they generally give a very low return... read more
 
ENERGY INFORMATION ADMINISTRATION (EIA)
The EIA describes itself as, "The U.S. Energy Information Administration (EIA) collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking,... read more
 
ENGULFING GREEN
A bottom candlestick reversal signal, this is a two candlestick pattern consisting of a large green candle enveloping a preceding red candle. This pattern implies that the trend is likely to... read more
 
ENGULFING PATTERN
In candlestick terminology, a multiple candlestick line pattern; a major reversal signal with two opposing-color real bodies making up the pattern (also referred to as a tsutsumi). An engulfing... read more
 
ENTREPRENEUR
This is a "go-getter" who establishes and runs a business for his own account and shares in the risks and profits.
 
ENTRY
The point at which a trader gets into a position in the market.
 
ENTRY THRESHOLD
This is the cost of establishing a new business in a particular industry. Some industries require a considerable capital investment to be viable and so have a high entry threshold. For example,... read more
 
ENVELOPE
Lines surrounding an index or indicator - that is, trading bands.
 
ENX
01 - 06 - 2020
The enX Group (ENX) is a "diversified industrial group that provides branded products and services to the petrochemical, fleet management, logistics and industrial sectors.”... read more
 
EOH
10 - 06 - 2020
Enterprise Outsourcing Holdings (EOH) was Africa’s largest information technology company with involvement in almost every aspect of computer applications. The company... read more
 
EPE
29-09-2020
Ethos Capital Partners (EPE) is a private equity fund (PEF), incorporated in Mauritius, which invests into unlisted companies for long-term capital appreciation on behalf of its... read more
 
EPP
30 - 09 - 2020
EPP is a Dutch-based real estate investment trust (REIT), listed on both the JSE and the Luxembourg Stock Exchange, and is owned 39% by Redefine. It owns 25 retail centers... read more
 
EPS
A company's earnings (profit) divided by the number of ordinary shares usually expressed as a number of cents per share. The earnings per share (EPS) includes all the companies incomes and expenses... read more
 
EQU
14 - 10 - 2020
Equites (EQU) is the only real estate investment trust (REIT) on the JSE which specialises in industrial logistics and distribution properties in South Africa and the UK.... read more
 
EQUILIBRIUM
A price region that represents a balance between demand and supply. This is a microeconomics term which suggests that in any free market supply and demand are opposing forces which reach a balance... read more
 
EQUILIBRIUM MARKET
A price region that represents a balance between demand and supply. This is a microeconomics term which suggests that in any free market supply and demand are opposing forces which reach a balance... read more
 
EQUITY
That portion of share capital which carries risk, and shares in profits through dividends that are dependent on profitability. Ordinary shares are often called equity shares, and other types... read more
 
EQUITY ACCOUNTING
When a company owns more than 20% of another company, then in terms of IAS 28, that company is an associate company and it must be valued at its cost plus any increase in net asset value. Investments... read more
 
EQUITY INVESTOR
A natural person (rather than a corporate entity) who invests on the stock market either directly or indirectly. Private investors make up only about 10% of the trades done on the JSE. The other... read more
 
EQUITY SHARE
Also sometimes called "equity" shares, these shares share in the profits and risks of the company. Unlike the fixed dividend paid to preference shareholders, the ordinary dividend is decided... read more
 
EQUIVOLUME CHART
Created by Richard W. Arms in 1963, a chart in which the vertical axis is the high-low range for each day, while the horizontal axis represents the volume of shares of stock or the number of... read more
 
ERN
29 - 05 - 2019 This is a bankrupt oil and gas exploration company which was listed in New York and on the JSE in 2014. The company is 56,7% held by Camac Energy Holdings, which is a company said... read more
 
ESCROW
An escrow account is one which is under the control of a third party (usually an attorney) who then determines when the funds can be released for payment based on specified conditions. Escrow... read more
 
ESR
This was one of South Africa's large listed construction and engineering companies involved in sanitation, pipelines, building and housing. Esor (ESR) recently went into business rescue in August... read more
 
ESTATE DUTY
A tax on a deceased estate. In South Africa, estate duty is 20% on the first R30m of an estate and then 25% on any amount above that. 
 
ESTIMATED EPS CHANGE
Change in estimated mean earnings per share for the current fiscal year from the last month, last three months and last six months to the current month.
 
ETF
Collections of securities that are bought and sold as a package on an exchange. Essentially, buying an ETF means tracking a group or "basket" of shares, bonds or commodities, and sometimes an... read more
 
ETN
A debt security traded on a stock exchange. An exchange trade note (ETN) is similar to an exchange traded fund (ETF) in that they both track underlying assets and both are traded on a stock exchange... read more
 
ETO
14 - 08 - 2020
Etion (ETO), previously Ansys, is an Alt-X listed technology company that started 31 years ago and listed on the JSE in June 2007. It seeks to capitalise on the digital revolution... read more
 
EURIBOR
This is abreviated to "euribor" and it is an interest rate which is based on the average rates for unsecured funds at European banks. It is Europe's equivalent of the London interbank offer rate... read more
 
EURO INTERBANK OFFERED RATE
This is abreviated to "euribor" and it is an interest rate which is based on the average rates for unsecured funds at European banks. It is Europe's equivalent of the London interbank offer rate... read more
 
EURODOLLAR
Dollars deposited in foreign banks, with the futures contract reflecting the rates offered between London branches of top US banks and foreign banks.
 
EUROPEAN CENTRAL BANK
The Central Bank for the European Union.
 
EUROPEAN OPTION
 
EUROPEAN UNION (EU)
The principal goal of the EU has been to establish a single European currency called the Euro, to officially replace the national currencies of the member EU countries. On January 1, 1999, the... read more
 
EUROSTOXX
The Eurostoxx 50 index is an index (weighted average) of the 50 largest and most liquid stocks trading in the Eurozone. It is just one of the indexes offered by Stoxx - which is owned by the... read more
 
EUZ
08 - 10 - 2020
Europa (EUZ) is a European metals developer which operates primarily in Spain where it mines lead, zinc and silver. They own 100% of the Toral project in Leon Province which... read more
 
EVASION
A criminal offence committed by someone who does not declare their tax position correctly in their tax return, thereby defrauding The Receiver of of Revenue of taxes due. Evasion differs from... read more
 
EVENING STAR
A candlestick formation which is the bearish counterpart of the morning star pattern; a top reversal, it should be acted on if it arises after an uptrend. The morning star and evening star formations... read more
 
EX OFFICIO DIRECTOR
This is a person who is deemed to be a director by virtue of his office or function within an organisation. Section 66 (4) (a) (ii) of the Companies Act (71 of 2008) states: "a person to be an... read more
 
EX-DIV
A share is "ex div" once the last day to trade has passed. Any sales after the last day to trade are done on the basis that the dividend accrues to the buyer, even if it has not yet been actually... read more
 
EX-DIVIDEND DATE
The day on which the right to receive a current dividend is not automatically transferred to a buyer. This is usually the Monday after the last day to register for the dividend. On this day the... read more
 
EXCHANGE
A securities exchange that is properly formulated and run in accordance with an Act of Parliament. The Johannesburg Securities Exchange (JSE) is an organised exchange and there are many others... read more
 
EXCHANGE CONTROL
This is a set of rules and limitations placed on the trade in foreign currencies. The normal objective of exchange control is to enable the government to stabilise the flow of funds into and... read more
 
EXCHANGE RATE
An exchange rate is the rate at which one currency can be traded for another. Thus, for example, the rand trades against the US dollar at rates which fluctuate throughout the day. The same is... read more
 
EXCHANGE TRADED FUND
Collections of securities that are bought and sold as a package on an exchange. Essentially, buying an ETF means tracking a group or "basket" of shares, bonds or commodities, and sometimes an... read more
 
EXCHANGE TRADED NOTE
A debt security traded on a stock exchange. An exchange trade note (ETN) is similar to an exchange traded fund (ETF) in that they both track underlying assets and both are traded on a stock exchange... read more
 
EXEMPT INCOME
In terms of the Income Tax Act natural persons (i.e. not corporate entities) do not have to pay tax on interest income from a South African source up to R23800 per annum (and R34500 for people... read more
 
EXEMPT SUPPLIES
South Africa has Value Added Tax of 15% which is levied on all products except  for what are known as "exempt supplies" - which include education, after-care for children, rentals, and certain... read more
 
EXEMPTED MICRO ENTERPRISE
An exempted micro enterprise (EME) is a small business in South Africa that is exmpted from the requirements of the Broad Based Balck Economic Empowerment Act (53 of 2003) because of its small... read more
 
EXERCISE
The process by which the holder of an option makes or receives delivery of shares of the underlying security.
 
EXHAUSTION GAP
When a share's price has been rising for some time and quickly, it will sometimes have a day where the lowest price is far above the previous day's high price - this shows on the chart as a gap... read more
 
EXIT
The point at which a trader closes out of a trade.
 
EXP
29 - 05 - 2020
Exemplar (EXP) is a real estate investment trust (REIT) which specialises in developing rural shopping centres through its relationship with McCormick Property Development.... read more
 
EXPANSIONARY POLICY
A policy of the Reserve Bank's Monetary Policy Committee (MPC) to stimulate the economy by reducing interest rates and other expansionary monetary policies such as buying back government bonds... read more
 
EXPENDITURE
This is an economics term which refers to the total expenditure within the economy. It is a method of calculating gross domestic product. The formula is:
Gross Domestic Product = Consumer... read more
 
EXPENSE
This something which a company has to pay for. Companies have two types of expenses - those which go up and down with sales and those which have to be paid even if there are no sales. The variable... read more
 
EXPENSE RATIO
This is a ratio used in the insurance industry to establish the direct costs associated with acquiring, servicing and underwriting the premiums earned by the company. These costs could include... read more
 
EXPENSIVE
A term used by analysts and investors to describe a share which is trading above what they perceive to be its real value. Obviously, this is a value judgement and each analyst and investor will... read more
 
EXPIRATION DATE
Generally the last date on which an option may be exercised. It is not uncommon for an option to expire on a specified date during the month prior to the delivery month for the underlying futures... read more
 
EXPONENTIAL MOVING AVERAGE
An exponential moving average (EMA) is one in which the latest prices in the moving average are weighted much more heavily than the oldest prices. The weighting varies over the period of the... read more
 
EXPONENTIAL SMOOTHING
A mathematical-statistical method of forecasting that assumes future price action is a weighted average of past periods; a mathematic series in which greater weight is given to more recent price... read more
 
EXPONENTIAL WEIGHTING
Moving averages are the most basic form of line chart in technical analysis. They are more commonly used in conjunction with other indicators than as indicators in their own right. One of the... read more
 
EXPORT
The sale of products produced locally in foreign markets generating an inflow of foreign currency. The value of a country's imports is subtracted from the value of its exports in the trade account... read more
 
EXPORT LED
A term used by economists to explain the fact that economic booms in South Africa are generally caused by a strong recovery in commodity exports and prices. This is because South Africa is primarily... read more
 
EXPOSED
The degree to which a portfolio or other investment is susceptible to risk from certain factors. For example, a share in a company whose main business is importing would be highly "exposed" to... read more
 
EXPOSURE
The degree to which a portfolio or other investment is susceptible to risk from certain factors. For example, a share in a company whose main business is importing would be highly "exposed" to... read more
 
EXPRESSION OF INTEREST
An expression of interest (EOI) is an approach by an acquisitive company which seeks to acquire another company. They would first send an EOI - and then engage in discussions with the target... read more
 
EXPROPRIATION OF LAND

The compulsory taking over of land by the government of a country. In most capitalist countries the right of... read more

 
EXTRAORDINARY ITEM
An Income Statement item which shows an expense or income which is not part of the company's normal business. For example, if a supermarket chain sells a piece of land and makes a profit, then... read more
 
EXTREME POVERTY
The worst level of poverty defined by the World Bank as an income per person of less than $1.25 per day. About one fifth of people living in developing countries are in extreme poverty... read more
 
EXX
14 - 08 - 2020
Exxaro (EXX) is South Africa's BEE coal company with interests in iron and heavy minerals. It has interests in Australia, America and Europe. It is a provider of coal to Eskom's... read more
 
EY
Earnings per share expressed as a percentage of the current market price of the share. For example, a company with 25 cents earnings per share and a market price of 250 cents would have an earnings... read more