List of Glossary Terms

The PDSnet Glossary of Terms contains definitions and explanations for over 2600 financial market terms. These definitions are constantly kept up-to-date with current topical examples from the markets. They are also updated for changes in legislation and current events like COVID19 and the July 2021 civil unrest.

The terms in the Glossary are directly linked to all PDSnet articles, confidential reports, lecture modules and other material. This means that a client reading one of our publications can immediately see which terms are defined in the Glossary and click through to read the definition. Terms within the definitions in the glossary are similarly linked, which gives the Glossary an enormous educational depth share market investors.

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 Latest


N SHARES

These are shares which rank in all respects equally to other ordinary shares except that they have an extremely low par value. Since the voting... read more

 
NAKED PUT
The writer of a put option contract who is not short of the underlying security.
 
NARROW RANGE DAY
A trading day with a smaller price range relative to the previous day's price range.
 
NARROW-BASED STOCK INDEX

Broad-based stock indices, such as the S&P 500, are defined as a basket of securities where the weight of any single constituent cannot... read more

 
NASDAQ

National Association of Securities Dealers Automated Quotation System. This is an over-the-counter share market in America. It provides a trading platform... read more

 
NATIONAL CREDIT ACT

This Act (34 of 2005) legislates the finding and providing of credit facilities to the public. It covers all aspects of the extension of credit including insurances,... read more

 
NATIONAL CREDIT REGULATOR

An impartial body established in terms section 12 of the National Credit Act (34 of 2005) whose function (in terms of section 13) is to "promote and... read more

 
NATIONAL DEBT

This is the difference between government revenue and expenditure. Typically, governments spend more than they receive from taxes and other types... read more

 
NATIONAL DEFICIT

This is the difference between government revenue and expenditure. Typically, governments spend more than they receive from taxes and other types... read more

 
NATIONAL ECONOMIC DEVELOPMENT AND LABOUR COUNCIL

On its website the National Economic Development and Labour Council (NEDLAC) describes itself as, "...the vehicle by which Government, labour, business and... read more

 
NATIONAL EMPOWERMENT FUND

A state owned enterprise (SOE) established in terms of the National Empowerment Act (105 of 1998) for the express purpose of promoting and facilitating... read more

 
NATIONAL ENERGY REGULATOR

The National Energy Regulator of South Africa (NERSA) is responsible for overseeing the various energy sources in the South African economy. This means... read more

 
NATIONAL FUTURES ASSOCIATION

National Futures Association - authorized by the US Congress in 1974 and designated by the Commodities Futures Trading Commission (CTFC) in 1982 as a "registered... read more

 
NATIONAL HEALTH INSURANCE

The NHI is based on the constitutional right of every person to have a basic minimum level of health care, irrespective of their ability to pay for it. At the... read more

 
NATIONAL TREASURY

The National Treasury falls under the Ministry of Finance and is established in terms of section 13 of the Constitution to manage the government's finances. Through... read more

 
NATIONALISATION

The taking over of privately owned assets, especially companies, by the government.... read more

 
NATURAL GAS

Natural gas is a clean burning hydrocarbon, producing far less carbon dioxide and air pollutants compared to coal, when used to generate electricity. It... read more

 
NATURAL PERSON

The law distinguishes between natural and juristic persons. A natural person is an individual of flesh and blood, while a juristic person is a corporation... read more

 
NATURAL RESOURCES

The natural resources of a country are those resources which exist in nature - its minerals and agricultural potential. Some countries are richly endowed... read more

 
NATURE OF BUSINESS

The type of business which a company conducts. The JSE divides listed companies into sectors and sub-sectors, but in truth it... read more

 
NAV

The company's assets minus its liabilities divided by the total number of shares in issue. Investors like to compare the current... read more

 
NCD

A commercial "I.O.U", usually issued by a commercial bank. It is a certificate representing a deposit usually of at least R100 000 which entitles the holder... read more

 
NDB

This is a BRICS bank which lends money to member countries. South Africa was a 20% shareholder, equal to the other members of BRICS at the... read more

 
NEAR CASH

Money held in various accounts by a company where it can only be liquidated after a delay. Thus the money in the company's bank account is immediately... read more

 
NEAR EQUITIES

These are classes of securities which share some of the characteristics of ordinary or equity shares. For example, a participating preference share,... read more

 
NEAR MONOPOLY

A company which has almost 100% of a particular market. True monopolies almost never exist in capitalist economies. There are always competitors... read more

 
NEAR-MONTH CONTRACT/FAR-MONTH CONTRACT
A futures contract whose expiration is near/far.
 
NEAR-THE-MONEY
An option with a strike price close to the current price of the underlying tradeable.
 
NEARBY DELIVERY MONTH

The futures contract month closest to expiration. Also referred to as the Spot Month. There are four futures close-outs each year - at the end of March,... read more

 
NECKLINE

A trendline drawn along the support or resistance points of various reversal and consolidation patterns (i.e., head and shoulders,... read more

 
NEDLAC

On its website the National Economic Development and Labour Council (NEDLAC) describes itself as, "...the vehicle by which Government, labour, business and... read more

 
NEGATIVE AMORTISATION

This means that a payment of the stated size is insufficient to repay even the interest on the debt, meaning the total debt actually increases each... read more

 
NEGATIVE DIRECTIONAL INDICATOR

An indicator developed by Welles Wilder and used as a component in the calcuation of his "average directional movement index". The negative directional... read more

 
NEGATIVE DIVERGENCE
When two or more averages, indices or indicators fail to show confirming trends.
 
NEGOTIABLE CERTIFICATE OF DEPOSIT (NCD)

A commercial "I.O.U", usually issued by a commercial bank. It is a certificate representing a deposit usually of at least R100 000 which entitles the holder... read more

 
NEPAD

This is an agency of the African Union which aims to, "a) Coordinate and Execute priority regional and continental projects to promote regional integration... read more

 
NERSA

The National Energy Regulator of South Africa (NERSA) is responsible for overseeing the various energy sources in the South African economy. This means... read more

 
NET ADVANCE/DECLINE

Your software includes a net advance/decline line (Net A/D) for each sector of the market. These are "breadth indicators" which show... read more

 
NET ASSET VALUE

The company's assets minus its liabilities divided by the total number of shares in issue. Investors like to compare the current... read more

 
NET CURRENT ASSETS

The difference between current assets and current liabilities. In most healthy companies, this difference will be positive, so that the company is... read more

 
NET DEBT/EBITDA RATIO

The ratio of a company's debt to its earnings before interest, taxation, depreciation and amortisation (EBITDA).... read more

 
NET FOREIGN ASSETS

Assets held outside of a country minus its foreign liabilities. In South Africa, most foreign assets are held by companies which are required... read more

 
NET INCOME
The earnings of an organisation after deducting taxation and all other expenses. This is obviously an important measure of a company's performance, but one should remember... read more
 
NET MARGIN

This is the ratio of net income to revenue in a company. Obviously, you want this "margin" to be as high as possible. Clearly, you... read more

 
NET OPEN FORWARD POSITION

This is the state of the Reserve Bank's forward book in the foreign currency market. In the past, the Reserve Bank ran a substantial... read more

 
NET OPERATING INCOME

Used to measure real estate investment trusts, this calculation is done by subtracting all operating expenses from revenue generated from... read more

 
NET PRESENT VALUE

The current value of a future sum of money or stream of incomes. Thus if you are looking at a share and after some analysis you decide that it will... read more

 
NET PROFIT MARGIN

This is the ratio of net income to revenue in a company. Obviously, you want this "margin" to be as high as possible. Clearly, you... read more

 
NET WORTH

The value of the assets of a company less the value of its liabilities. It is common to hear investors saying, "A particular share... read more

 
NEW CAPITAL FRAMEWORK

An agreement between the major countries of the world on the standards to be applied to their major banks so as to minimise the risk of a bank collapse... read more

 
NEW DEVELOPMENT BANK

This is a BRICS bank which lends money to member countries. South Africa was a 20% shareholder, equal to the other members of BRICS at the... read more

 
NEW ISSUE

A listing of a new security or an issue of more shares in an already listed security. Usually, if a company wants to raise additional... read more

 
NEW LISTING

The acceptance of a company's shares for trading on the Johannesburg Stock Exchange (JSE). New listings usually occur when the economy... read more

 
NEW ORDER MINING RIGHTS

The Minerals and Petroleum Resources Development Act (MPRDA - 28 of 2002) makes the state the custodian of mineral rights in South Africa. Anyone who wishes to... read more

 
NEW PARTNERSHIP FOR AFRICAN DEVELOPMENT

This is an agency of the African Union which aims to, "a) Coordinate and Execute priority regional and continental projects to promote regional integration... read more

 
NEW YORK STOCK EXCHANGE

The biggest stock exchange in the world, located in New York City with a market capitalisation of about $25 trillion in November 2023. The S&P500... read more

 
NEWGOLD

The is an ABSA ETF which tracks the rand price of gold. It is the equivalent of buying krugerrands, but with the advantage that there is no... read more

 
NEXT IN FIRST OUT

A method of valuing stock at its replacement cost. So existing stock is valued at what it would cost to replace rather than the price paid for it. This... read more

 
NFA

National Futures Association - authorized by the US Congress in 1974 and designated by the Commodities Futures Trading Commission (CTFC) in 1982 as a "registered... read more

 
NHI

The NHI is based on the constitutional right of every person to have a basic minimum level of health care, irrespective of their ability to pay for it. At the... read more

 
NICKEL

A mineral with the chemical symbol "Ni". Nickel oxidises slowly and only very small quantities are found in nature and is most commonly found in iron pentlandite... read more

 
NIKKEI INDEX

The main stock exchange index from Tokyo in Japan. The Nikkei is an average of the 225 largest companies trading on the Tokyo stock... read more

 
NIL-PAID LETTERS

A security which is temporarily listed on the stock exchange and which represents the right to take up the shares of a certain company... read more

 
NINJA BOND

This is a term coined for home loans that were granted, mostly in America, where the bond-holder had almost no credit rating at all. The term stands for "No Income,... read more

 
NO LOAD
Without any sales charge. For mutual funds, shares sold at net asset value.
 
NOI

Used to measure real estate investment trusts, this calculation is done by subtracting all operating expenses from revenue generated from... read more

 
NOISE

An incorrect interpretation of the market due to daily price and volume fluctuations. Volatility in the market can be smoothed out... read more

 
NOMAD

This term (abbreviated to "nomad") refers to a person or firm that is appointed to assist a company that has recently listed onto the London Stock... read more

 
NOMINAL RETURN

The return on an investment before taking the effect of inflation into account. Thus, if an investment is purchased for 1000c and sold a year... read more

 
NOMINAL VALUE

The nominal value of an investment is its value "on paper". Usually, investments over any period of time are evaluated on their nominal return and... read more

 
NOMINAL YIELD

The return on an investment before taking the effect of inflation into account. Thus, if an investment is purchased for 1000c and sold a year... read more

 
NOMINATED ADVISOR

This term (abbreviated to "nomad") refers to a person or firm that is appointed to assist a company that has recently listed onto the London Stock... read more

 
NOMINEE

A person or company nominated to perform some function on behalf of a principal. In the share market, the nominee typically registers shares... read more

 
NON CONFIRMATION

Today, there are literally hundreds of line technical indicators each of which represents a different mathematical formulae and trading idea. Technicians... read more

 
NON DISCRETIONARY STOCKBROKING ACCOUNT

A stockbroking account where the client must make all the decisions about what to buy and sell and when to do it. A discretionary account allows... read more

 
NON-CASH ITEM

An accounting term which refers to entries in the books of account which do not reflect the movement of money. The most common example is depreciation... read more

 
NON-CONTROLLED CLIENT

This is a person who decides to invest directly without going through a stockbroker. Such a person must appoint a a Central Securities Depository... read more

 
NON-CONTROLLING INTEREST

This is a significant shareholding (usually above 5%) which does not allow the shareholder to control the company but which affords... read more

 
NON-CORE

A division or subsidiary of a company is regarded as non-core if it does not contribute to the main business of the company. Such subsidiaries or... read more

 
NON-CUMULATIVE

A term used to describe preference shares which do not accumulate their dividends. Most preference shares are cumulative in that if the company does... read more

 
NON-CURRENT LIABILITIES

A debt, which is to be repaid over years rather than months. A good example of this would be debentures, which carry a fixed percentage return... read more

 
NON-DISTRIBUTABLE RESERVE

A concept from the old Companies Act which referred to that portion of accumulated shareholders' equity which could not be distributed in... read more

 
NON-EXECUTIVE DIRECTOR

A director who is not employed by the company and has no employment contract. An executive director has an employment contract and works directly... read more

 
NON-FARM PAYROLL

An economic statistic from America which includes all employees in America except for farm workers, employees of non-profit organisations (like charities)... read more

 
NON-FUNGIBLE

The tradability of an asset, usually on an organised exchange. The ability to easily sell an asset can have a significant impact on its value. For... read more

 
NON-REDEEMABLE

A term used to describe preference shares which cannot be redeemed by the company. Some preference shares are redeemable on a certain specified date... read more

 
NON-RESIDENT SHAREHOLDER

This is an entity outside of South Africa who holds shares in a company which is resident in South Africa. Such share certificates must, within... read more

 
NON-RESIDENT SHAREHOLDERS' TAX 

This is an entity outside of South Africa who holds shares in a company which is resident in South Africa. Such share certificates must, within... read more

 
NON-TREND DAY
A narrow range trading day lacking any discernible movement in either direction.
 
NON-VOTING SHARES

Shares which cannot vote at shareholder meetings. In general, the people who contribute capital to a business have the right to vote in direct... read more

 
NONLINEAR STATISTICS

Statistics theory that attempts to define probability distribution from disorder to either a more orderly state or a sharp trend reversal,... read more

 
NORMALISED EARNINGS

The profit of a company adjusted to eliminate the effect of seasonality. Some company's are very seasonal and get most of their income in... read more

 
NORTH SEA BRENT OIL

North Sea oil controlled by the UK and Norway. This type of oil is generally traded at a slight premium to West Texas light sweet crude.  Oil is a... read more

 
NOT HELD

An order submitted to a brokerage firm with the understanding that it will use its best efforts to execute the order according to the customer's instructions,... read more

 
NOTES TO THE ACCOUNTS

These form part of the annual financial statements of a company. They supply more information on the figures contained in the financial accounts,... read more

 
NOTICE DAY
The day that a notice of intent to deliver is issued to a futures contract holder.
 
NOTICE OF INCORPORATION

A form (CoR14.1) which must be completed and submitted to the Companies and Intellectual Property Commission (CIPC) when applying for a company to... read more

 
NUMBER OF DEALS

One of the pieces of information supplied by the JSE for each listed company after each trading day. There are no indicators... read more

 
NUMISMATIC

The study of coins, paper money and medals and the subsequent value that results from their rarity. In other words, coins which have numismatic value are worth... read more

 
NYSE

The biggest stock exchange in the world, located in New York City with a market capitalisation of about $25 trillion in November 2023. The S&P500... read more

 
NYSE AMERICAN

Originally an overflow of companies that were too small to list on the New York Stock Exchange, the "Amex" or "the curb" as... read more