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Screen
In searching for shares that meet certain investment criteria, you may screen a large sample to identify one or more to invest in. You can also establish a screen, which is a set of criteria against which you measure shares (or other investments) to find those that meet your criteria. For example, you might screen for shares that meet a certain environmentally or socially responsible standard, or for those with current price-to-earnings ratios (P/E) less than the current market average.

Scripophily
Scripophily is the practice of collecting antique shares, bonds, and other securities. The most valuable documents are usually the most beautiful, or those that have some historical significance because of the role the issuing company played in the economy. Sometimes those with distinctive errors are also especially valuable.

Secondary market
When shares and other securities are bought and sold after the date they are first issued, they trade on what's known as the secondary market. The issuer, or company that offers the share or securities, receives no proceeds from these secondary trades, as it does when it issues these securities the first time in the primary market. In fact, most securities trading occurs in the secondary market through the stock exchanges.

Secondary offering
The most common form of secondary offering occurs when an investor (usually a company, but sometimes an individual) sells to the public a large block of shares or other securities it has been holding in its portfolio. In a sale of this kind, all of the profits go to the seller rather than the company that issued the securities in the first place. Secondary offerings can also originate with the issuing companies themselves. In these cases, a company issues shares of its stock over and above those sold in its initial public offering (IPO), usually in order to raise additional capital.

Sector
A sector is a group of shares, often in one industry. The performance of any single share in a sector can be measured against the performance of the sector as a whole, showing where that share ranks in relation to its peers. Mutual funds that concentrate on the shares of a specific sector are known as sector funds. These funds can be more volatile than other funds, reflecting the current strength or weakness of that sector in the overall economy. Technology shares, for example, were hot in the year 2000 but later in the doldrums.

Sector fund
Also called specialty or specialized funds, sector mutual funds concentrate their investments in a single segment of an industry, such as biotechnology, natural resources, utilities, or regional banks, for example. Sector funds tend to be more volatile and erratic than more broadly diversified funds, and often dominate both the top and bottom of annual mutual fund performance charts. A sector that thrives in one economic climate may wither in another one.

Secured bond
The issuer of a bond or other debt security may guarantee, or secure, the bond by pledging, or assigning, collateral to investors. If the issuer defaults, the investors may take possession of the collateral. A mortgage-backed bond is an example of a secured security, since the underlying mortgages can be foreclosed and the properties sold to recover some or all of the amount of the bond. Holders of secured bonds are at the top of the pecking order if an issuer misses an interest payment or defaults on repayment of principal. However, there were instances, in India, where the Trustees of a bond failed to carry out their obligations, leaving the investors in a lurch, when defaults in interest payment or repayment of principal occurred.

Securities and Exchange Commission (SEC)
The SEC is an independent federal agency that oversees and regulates the securities industry in the US, and enforces securities laws. It requires registration of all securities offered in interstate commerce, and of all individuals and firms who sell those securities. Established by Congress in 1934, the SEC sets high standards for disclosure about publicly traded securities, including stocks, bonds, and mutual funds, and works to protect investors from misleading or fraudulent practices, including insider trading. The SEC has also helped to establish a competitive national market system known as Intermarket Trading System (ITS) for trading securities, and set up a system for clearing and settling securities transactions.

Securities Investor Protection Corporation (SIPC)
The SIPC is a non-profit corporation created by U.S.Congress to insure investors against losses caused by the failure of a brokerage firm. Through the SIPC, assets in your brokerage account are insured up to $500,000 (including up to $100,000 in cash), but only against losses that result from the brokerage firm going bankrupt, not against market losses caused by trading decisions or other causes. All brokers and dealers registered with the Securities and Exchange Commission (SEC) are required to be SIPC members.

Security
Generally speaking, a security is a financial instrument that shows you own shares in a company , have loaned money to a company, or have rights to future ownership (as with options, rights, or warrants). Traditionally, securities were physical documents, such as share or bond certificates. But with the advent of electronic recordkeeping, paper certificates have increasingly been replaced by electronic documentation.

Sell-off
A sell-off is a period of intense selling of securities and commodities triggered by declining prices. Sell-offs — sometimes called dumping — usually cause prices to plummet even more sharply.

Settlement Date


Settlement Period
For administrative convenience, a Stock Exchange divides the year into a number of settlement periods so as to enable members to settle their trades. All transactions executed during the settlement period are settled at the end of the settlement period.

Settlement Risk
The risk that operational difficulties may prevent the settlement of a transaction even when the counter party is able to perform.

Shareholder
If you own share in a company , you are a shareholder of that company. You're considered a majority shareholder if you (alone or in combination with other shareholders) own more than half the company's shares, which allows you to control the outcome of a company vote. Otherwise, you are considered a minority shareholder.

Sharpe ratio
One way to compare the relationship of risk and reward in following different investment strategies, such as emphasizing growth or value investments, is to use the Sharpe ratio. To figure the ratio, you subtract the risk-free return from the average return of an investment portfolio made up of these investments over a period of time, and then divide the result by the standard deviation of the return. A strategy with a higher ratio is less risky than one with a lower ratio. This approach is named for William P. Sharpe, who won the Nobel Prize in economics in 1990.

Short position
If you sell share short and have not yet repurchased shares to replace the ones you borrowed, you are said to have a short position in that share. Similarly, if you buy a futures contract that commits you to sell a commodity at a specific price at some date in the future, you have a short position in that commodity.

Soft market
A soft market, also known as a buyer's market, is one in which supply exceeds demand. In the financial world, the term often refers to a time in which there are more shares or bonds for sale than there are customers eager to buy them. The lack of interest creates a wide spread, or gap, between the prices being asked for securities and the prices being bid. As a result, trading is often sluggish.

Spin-off
In a spin-off, a company sets up one of its existing subsidiaries or divisions as a separate company. The motives for spin-offs vary. In some cases, a company may want to refocus its core businesses, shedding those that it sees as unrelated. Or it may want to set up a company to capitalize on investor interest. In other cases, a company may face regulatory hurdles in expanding its business and spin off a unit to be in compliance.

Spot market
Commodities and foreign currencies are traded for immediate delivery and payment on the spot market, also known as a cash market. The term refers to the fact that the full cash price is paid "on the spot," or within a short period of time. A cash sale, whether arranged in person, over the telephone, or electronically, is the opposite of a forward contract, where delivery and settlement are set for a date in the future, or a futures contract, which is an agreement to trade a commodity for a set price on a specific date in the future.

Spot price
The spot, or cash, price is the price of commodities and foreign currencies that are being sold for immediate delivery with payment in cash.

Spread
In the most general sense, a spread is the difference between two similar measures. In the stock market, for example, the spread is the difference between the highest price offered and the lowest price asked.

Standard & Poor's (S&P)
Standard & Poor's is an investment services company, in U.S., that rates bonds, shares, commercial paper, and insurance companies. It also compiles influential stock market indexes and publishes a broad range of reports, guides, and handbooks on financial topics. The S&P 500-stock Index is one of the key measures of stock market performance and is also the benchmark for a large number of stock index funds.

Standard & Poor's 500-stock Index (S&P 500)
This benchmark index, of U.S., tracks the performance of 500 widely held large-cap stocks in the industrial, transportation, utility, and financial sectors. This capitalization weighted index, also called a market value weighted index, gives greater weight to stocks with the greatest number of existing shares and highest share prices. That can mean that a relatively few stocks have a major impact on the movement of the index. The stocks included in the index, their relative weightings, and the number that represent each sector vary from time to time, at S&P's discretion.

Standard deviation
Standard deviation is a statistical measurement of how far a variable quantity, such as the price of a share, moves above or below its average value. The wider the range, which means the greater the standard deviation, the riskier an investment is considered to be. Some analysts use standard deviation to predict how a particular investment or portfolio will perform. They calculate the range of the investment's possible future performances based on a history of past performance, and then estimate the probability of meeting each performance level within that range.

Standard Price
The standard price of a security is generally worked out as a weighted average price of all recorded transactions for that security adjusted to the nearest rupee.

Stochastic modeling
Stochastic modeling is a statistical process that uses probability and random variables to predict a range of probable investment performances. The mathematical principles behind stochastic modeling are complex, so it's not something you can do on your own. But based on information you provide about your age, investments, and risk tolerance, a number of online financial sites use stochastic modeling to help you evaluate the probability that your current investment portfolio will allow you to meet your financial goals. Appropriately enough, the term stochastic c comes from the Greek word meaning "skillful in aiming."

Stock
In the U.S. parlance, stock is an equity investment that represents part ownership in a corporation and entitles you to part of that corporation's earnings and assets. Common stocks give shareholders voting rights but no guarantee of dividend payments. Preferred stocks provide no voting rights but usually guarantee a dividend payment. In the past, shareholders received a paper stock certificate — called a security — verifying the number of shares they owned. Today, share ownership is usually recorded electronically, and the shares are held in street name by your brokerage firm.

Stock option
A stock option is contract that gives the buyer the right to buy or sell a specific share at a preset price during a certain time period and obligates the seller to buy or sell the stock if the option is exercised. If an option isn't exercised within the set period, it expires.

Stock split
When a company wants to make its shares more attractive and affordable to a greater number of investors, it may authorize a stock split to create more shares selling at a lower price. A 2-for-1 stock split, for example, doubles the number of existing shares and halves the face value and it’s price. If you own 100 shares, having face value of Rs.10 each, and it is selling at Rs.50 a share, total market value of your shares is Rs.5,000 and the company's board of directors authorize a 2-for-1 split, you would own 200 shares, having face value of Rs.5 each and it’s market price, normally, would be Rs.25, with the same face value of Rs.1000 and market value of Rs.5,000. Announcements of stock splits, or anticipated stock splits, often generate a great deal of interest. Buyers may simply want to take advantage of the lower share price, or they may believe that the split stock will increase in value, moving back toward its presplit price. In addition, a company can reverse the process and consolidate shares to reduce their number by authorizing a reverse stock split.

Stop order
You can issue a stop order, which instructs your broker to buy or sell a security once it trades at a certain price, called the stop price. Stop orders are entered below the current price if you are selling and above the current price if you are buying. For example, if you owned a stock currently trading at Rs.35 a share that you feared might drop in price, you could issue a stop order to sell if the price dropped to Rs.30 a share to protect yourself against a larger loss. Once the stop price is reached, your order becomes a market order. If the price drops very quickly, and other orders have been placed before yours, the stock could actually end up selling for less than Rs.30.

Stop-limit order
A stop-limit is a combination order that instructs your broker to buy or sell a share once its price hits a certain target, known as the stop price, but not to pay more for the share, or sell it for less, than a specific amount, known as the limit price. For example, if you give an order to buy at "40 stop 43 limit," you might end up spending anywhere from Rs.40 to Rs.43 a share to buy, but not more than Rs.43. A stop-limit order can protect you from a rapid run-up in price, but you also run the risk that your order won't be executed because the share's price leapfrogs your limit.

Systematic risk
Systematic risk, also known as market risk, is the risk that's inherent in, or characteristic of, a particular type or class of security, such as shares or bonds, as opposed to the risks posed by an individual security of that type. For example, the prices of existing bonds characteristically drop when interest rates go up. So a systematic or market risk of owning bonds is that you would probably realize less than the par value of a bond if you sold it in the secondary market after a jump in interest rates. That loss of value, however, would not reflect whether or not the individual bond was a good credit risk.