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10 vocabs often found in a stock analysis that novice investors should know

It’s natural for novice investors to feel afraid to read “stock analysis” that is full of unfamiliar terms, making them not know the meaning of those terms or the meaning of the article, and doubt it. This time, ACU PAY will give you 10 vocabulary words that you should know about stock analysis. If you know the meaning of these words, you will understand more about the analysis.

Content

Capital Gain

Capital gain is a gain on the margin of stock prices. If you choose to be a Technical investor, this information is important. Profit from Capital Gain is taxed in some countries (Capital Gain Tax). In Thailand, the proceeds from the sale or transfer of securities on the SET are not taxed. In the case of off-market securities sales or transfers, individual investors who stay in Thailand for 180 days in the tax year are subject to withholding tax at progressive tax rates and income must be included at the end of the year. Capital Gain from investment in mutual funds is exempt from tax.

VI - Value Investment

If your investment model chooses good fundamentals and focuses on holding for a long time, it means that you are among the VI or Value Investment investors who will buy shares in a low-priced period and do not expect short-term capital gains.

Uptrend Downtrend

The uptrend is the direction of the upward trend of the price graph, which can be seen from the naked eye without any reference to the theory or any outline. The upward trend can be seen that prices are rising.

The downtrend is the direction of the downward movement in the price graph. It can be seen from the naked eye without a theoretical reference or any outline. The downward trend can be immediately seen that prices are falling.

Dividend Yield

 The dividend yield is a measure to inform investors that if they buy stocks at the current market price level, what percentage of the dividend yield is likely to be received from the share price.

Target Price or Fair Value

It is a target price or fair value of the stock market, which analysts estimate from fundamental factors such as earnings, cash flow, financial ratios, and future business outlook. If the target price is higher than the current share price, it is worth investing in. If the target price is lower than the current share price, this means that the stock may be too expensive to invest.

Turn around

Refers to the loss of stocks that used to have turnover till the price decreased for a long time and then turned profitable again, resulting in a sharp rise in stock prices and a high yield.

Outperform Market

Stocks with strong fundamentals and better returns than the overall stock market. For example, the SET Index (the Stock Exchange of Thailand) is expected to rise 5%, but this stock is expected to grow 15%, which is considered an interesting stock by analysts.

Underperform Market

This refers to stocks that have weak fundamentals and are likely to generate worse returns than the overall stock market. It is in contrast with the outperform market. This may be due to a downtrend in the company’s earnings or the share price does not reflect all the negative factors.

Circuit Breaker

Measures taken by the stock market to temporarily suspend trading in some cases. For example, trading has dropped to an unusual level, allowing investors to investigate information and news before resuming trading.

Market Price

The market price or the price of the shares traded on the market at that time. The stock market will be the last trading price reflecting investors’ buying and selling needs, depending on factors such as the company’s performance, expected dividend payment rate, and general investor confidence.

If you understand these terms, it will greatly increase investment opportunities and help understand the details of the stock in many ways, whether it affects the fundamentals, the importance of each meaning, and what is interesting is the first part to look at before going to the target price.

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