Valuation: Process of determining the value of a portfolio of assets, including any accrued income.
Value Investing: The investment style of attempting to buy underpriced stocks that have the potential to perform well and appreciate in terms of price.
Value at Risk (VAR): VAR is the maximum loss over a target horizon such that there is a low, prespecified probability that the actual loss will be larger.
Variance: The degree to which a given set of number/ data points vary about the mean. It is the square of the standard deviation.
Vanilla Issue: A straight fixed-rate issue that has terms and conditions usually accepted as being convenient to a particular securities market.
Vanishing Companies: Companies that have not complied with specific provisions of the listing agreement and regulations of the stock exchanges, and are not physically traceable at the registered address mentioned in the offer document.
Value Added: Additional value given to a commodity by means of labor or technology so that the character of the commodity is altered. For example. When a raw material has been converted to finished goods, a value has been added.
VAT (Value Added Tax): A tax ultimately paid by the customer. A cumulative tax in that at each stage of value addition as the commodity passes from one manufacturer to another, the tax has to be paid.
Venture Capital: Investment in a new start-up business carrying considerable financial risk but with above-average prospects of reward. Sources include wealthy individuals, business investment companies, and merchant banks. Venture capitalists are rewarded with a share in profits, preference shares, or the promise of a certain allotment of the number of equity shares when the enterprise grows.
Venture Capital Fund: A fund established in the form of a trust or a company including a body corporate and registered under the SEBI venture capital fund regulations which - has a dedicated pool of capital, raised in a manner specified in the regulations, and invests in venture capital undertaking in accordance with the regulations.
Venture Capital Undertaking: A domestic company whose shares are not listed on a recognized stock exchange in India and which is engaged in the business of providing services, production, or manufacture of articles or things or does not include such activities or sectors.
Vertical Spread: Buying and selling puts or calls of the same expiration month but with different strike prices.
Vesting: The process by which the employee is given the right to apply for shares of the company against the option granted to him in pursuance of the Employee Stock Option Scheme.
Volatility: Volatility equates to the variability of returns from an investment. It is an acceptable substitute for risk; the greater the volatility, the greater the risk that an investment will not turn out as hoped because its market price happens to be on the downswing of a bounce at the time that it needs to be cashed in. The problem is that future volatility is hard to predict and measures of past volatility can, themselves, be variable, depending on how frequently returns are measured (weekly or monthly, for example) and for how long. Therefore, putting expectations of future volatility into predictive models is of limited use, but resorting to using past levels of volatility is equally limited.
V-Formation: A chart pattern in technical analysis which forms a V which indicates that the share price has bottomed out and is on an upward course, a reverse ‘V’ will indicate the opposite trend.
VIX: Widely used index maintained by the Chicago Board of Exchange, reflecting the expectation of volatility in the market over the next 30-day period.
Volatile: Subject to frequent and violent fluctuations. If the volatility of a share is due to inherent factors like variability in its earnings, the smallness of the issue; the cyclical nature of the industry to which it belongs, it is measured by the alpha factor. If on the other hand, the volatility is market-related it is measured by the beta factor.
Volatile Shares: Shares that are subject to sharp fluctuations in price show a considerable difference between their highest and lowest recorded prices.
Volume: Refers to the total volume of shares traded on a particular day and over a period. It shows the strength or weakness of the market moving up and down. An increased volume shows the strength of the movement, while a decline shows a weakening movement. If a low volume extends over weeks or months the market is lethargic, with only small advances or declines. The volume represented by bar charts, read along with price charts, is an important indicator in technical analysis. This is a concept of the Dow Theory.
Volume of Trading: The total number of shares that changes hands in a particular company’s securities. This information is useful in explaining and interpreting fluctuations in share prices.
Voluntary Delisting: Delisting of securities of a body corporate voluntarily by a promoter or an acquirer or any other person other than the stock exchange
Voting Rights: The entitlement of a shareholder to exercise a vote in the general meeting of a company.
Voting Shares: Shares that give the stockholder the right to vote at company meetings — for example, on the election of directors.
Volume Weighted Average Price (VWAP): Benchmark for trading efficiency. It measures the average price at which a share is traded in the market over a period, and can be compared against the price actually achieved by a fund manager. VWAP is calculated by adding up the monetary value traded for every transaction (price times number of shares traded) and then dividing by the total number of shares traded in the period.
Vulture Fund: Fund which buys securities in distressed investments, such as high-yield bonds in or near default, or equities that are in or near bankruptcy.
Stock Market Reference (A-Z)