Relative Strength Index (acronym RSI) is one of the most extensively used momentum oscillators in the realm of technical analysis of stocks. It was introduced by Welles Wilder in June 1978 and its computation is explained in detail in his book New Concepts in Technical Trading System. Momentum oscillator measures the velocity and magnitude of

The issuing company fixes a particular date when the investor must own shares in order to be eligible to participate in corporate events like receiving dividend, bonus shares etc. This is called record date. By this date, the company identifies its shareholders and sends them dividends, bonus shares or notice for AGMs etc., as the

Settlement date is the day on which a trade or a derivative contract must be settled by transferring the actual ownership of a security to the buyer, against necessary payment for the same. After a trade order is executed, it generally takes one to three days to settle it depending on the type of security

Stochastic Oscillator is one of the important tools used for technical analysis in securities trading. This technique was developed in late 1950s by Dr. George Lane. The indicator picks one observation point in current base and refers to all points in the defined range from where the highest and lowest point are considered for comparison.

Moving average convergence divergence, or MACD, is one of the most popular tools or momentum indicators used in technical analysis. This was developed by Gerald Appel towards the end of 1970s. This indicator is used to understand the momentum and its directional strength by calculating the difference between two time period intervals, which are a

It is a rate at which the price of a security increases or decreases for a given set of returns. Volatility is measured by calculating the standard deviation of the annualized returns over a given period of time. It shows the range to which the price of a security may increase or decrease.  Volatility measures

Penny stocks are those that trade at a very low price, have very low market capitalisation, are mostly illiquid, and are usually listed on a smaller exchange. Penny stocks in the Indian stock market can have prices below Rs 10. These stocks are very speculative in nature and are considered highly risky because of lack

STT is a kind of turnover tax where the investor has to pay a small tax on the total consideration paid or received in a share transaction. STT was introduced in the Budget of 2004 and implemented in Oct 2004. The objective behind the levy is to mitigate tax evasion as the same is taxed

Bonus shares are additional shares given to the current shareholders without any additional cost, based upon the number of shares that a shareholder owns. These are company's accumulated earnings which are not given out in the form of dividends, but are converted into free shares. The basic principle behind bonus shares is that the total

When a company declares a stock split, the number of shares of that company increases, but the market cap remains the same. Existing shares split, but the underlying value remains the same. As the number of shares increases, price per share goes down. Stock split is done to infuse liquidity and to make shares affordable