Glossary

Major stock markets

(by capitalisation of domestic shares in 1997, in millions of Swiss Francs)

New York Stock Exchange  
12918974.6
Tokyo
3034005.2
London
3009090.8
XETRA
1200631.3
Paris
981191.5
Zurich
839188.5
Toronto
825852.3
Amsterdam
681810.8
Hong Kong
601343.1
Milan
501451.9
Sydney
430309.4

 

Market capitalisation

This amount corresponds to what the company is worth on the stock exchange, as it is obtained by multiplying the share price by the total number of shares outstanding.

 

Netscape

Software designed to allow the user to search the Internet for information.

 

NYSE

The most important of all stock exchanges is without a doubt the New York Stock Exchange. Commonly referred as "Wall Street", the name of the street in which it is located.

 

Previous day’s close

Indicates the closing price of the previous day or, following a weekend or a holiday, that of the previous trading session's close.

 

Profit-sharing securities

In addition to shares, a certain number of profit-sharing securities are also similarly traded on the stock exchange, such as:

  • participation certificates
  • dividend rights certificates (DRCs)

These securities do not confer a shareholder status to the security owner but give him or her the right to a share in the net profit or subscription rights in the case of upcoming issues.

 

Prospectus

This publication is mandatory, and must provide potential investors with information on the company’s activities, goals, conditions of the securities issue, etc.

 

Quote

Another term denoting the price of a share or bond. Exchange-traded shares are also called "quoted" shares.

 

Ratios

Financial analysts use different ratios (one value divided by another) in order to define as objectively as possible the price of shares listed on the stock exchange. For example:

  • P/E (price/earnings ratio), or the price of a share divided by most recent annual earnings per share of the company concerned.
  • PE/G (price/earnings to growth), which is obtained by dividing PER by the profit growth rate.

Specialists may also use other, more sophisticated ratios, such as "P/CF" (price to cash flow), "DDM" (dividend discount model), "FCF/E" (free cash flow to equity) or "FCF/F" (free cash flow to the firm).