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Finance GlossaryBull Market
Bull Market
Definition of Bull Market
Bull market is a positive trend in the stock market where price of shares increase by 20% or more after falling by 20%. Investors may say they’re bullish or expect a bull market to arrive when they believe that there will be prolonged periods of increase in the stock market.
Related Terms
Working Capital
Working capital represents a company’s short-term financial health and operational efficiency, calculated as current assets minus current liabilities. For instance, a business with sufficient working capital can comfortably pay suppliers and meet day-to-day expenses, while negative working capital may indicate liquidity challenges.
Growth Stocks
Growth stocks are shares of companies that have the potential to outperform the market. These are stocks can grow faster than the market due to strong fundamental characteristics like a strong balance sheet, high Earnings Per Share, solid P/E, and more that can bolster its profits in the medium to long term.
Holding Period
The holding period of a financial security is the time period between buying and selling the said security. It is the total amount of time for which the security has been held in the portfolio of an investor. At times, there’s a mandatory holding period attached to a security. During this mandatory holding period, the security can not be sold.
Benchmark
A benchmark is a standard used by investors to compare the performance of a stock, commodity, or other securities.
Stock indices like Nifty 50, Sensex, Nifty Bank, and others are often used as benchmarks to evaluate the performance of one or more stocks.
The onset of a bear market is generally in tandem with poor economic conditions.
Benchmarks are not just used for evaluating markets or securities, they can also be used to assess the performance of an investor or wealth manager. Here are some outcomes if the returns are:
Stock indices like Nifty 50, Sensex, Nifty Bank, and others are often used as benchmarks to evaluate the performance of one or more stocks.
The onset of a bear market is generally in tandem with poor economic conditions.
Benchmarks are not just used for evaluating markets or securities, they can also be used to assess the performance of an investor or wealth manager. Here are some outcomes if the returns are:
- Greater than benchmark: the asset is doing considerably well (great)
- Same as benchmark: the asset is moving with the market (okay)
- Less than benchmark: the asset is performing poorly (bad)
Return on Equity (ROE)
The Return on Equity is a metric that helps to find the how effectively a company uses the money of its shareholders to generate profits. The ROE can be obtained by dividing the new profit generated by the equity of shareholders. When a company has a higher ROE, it implies that it has a strong management and strong profitability. Investors often compare the companies within the same sector using the ROE. The ROE also helps investors determine the potential of the company to generate wealth in the long term.
Mid-Cap
Mid-Cap companies are those ranked 101 to 250 by market capitalisation in the overall market. They are generally larger and more stable than small-cap companies while still offering higher growth potential than large-cap stocks. Mid-cap stocks often appeal to investors seeking a balance between growth opportunities and risk.
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