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Glossary: B


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Balance sheet

One of the main components of a company’s financial statements, the balance sheet provides an overview of the company’s assets (what it owns) and liabilities (what it owes) at the end of a financial year.

 

Bank Interchange Code (BIC)

A unique code identifying a participant.

 

Bargain Conditions Apply

Certain Conditions were agreed between the two participants at the time of trading.

 

Basket

A portfolio consisting of more than one security that may or may not replicate an index. For example, a share or equity basket is one that contains shares in more than one company.

 

Bear

An investor who sells a security in the hope of buying it back at a lower price, as he thinks the market will go down. A bear market is a falling market in which bears would prosper.

 

Best bid

The highest bid price for a specific tradable instrument (i.e. the highest price any buyer has declared that they are willing to pay for a specific security at a given time). Determined by the current quotes and orders in the trading system.

 

Best offer

The lowest offer price for a specific tradable instrument (i.e. the lowest price any seller has declared that they are willing to accept for a specific security at a given time). Determined by the current quotes and orders in the trading system.

 

Bid offer spread

The difference between the bid and offer prices of a security.

 

Bid price

The price at which a market participant is bidding to buy shares.
Bidding Company (in a Takeover) The company that is planning to acquire another company.

 

Bid Situation

This security is currently engaged in a bid situation, whether hostile or otherwise.

 

Big Bang

27 October 1986, when the Exchange's new regulations took effect and the automated price quotation system was introduced.

 

Block Trade

The transaction was reported using the block trade facility, which is at least 75 times the NMS for a security with an NMS of 2,000 shares OR above 50 times the NMS for a security with an NMS of 1,000 shares.

 

Blue chip

A term used to describe large, well-known companies that offer stable earnings and consistent dividend record. Blue-chip companies are reputed to be reliable investments.

 

Bond price

The market price of a bond depends on the coupon rate, the market interest rate and the number of years to maturity. Bond prices are inversely related to interest rates.

 

Bonds

Debt securities issued by governments and companies as a means of raising capital which generally entitle the holder to a fixed-rate of interest during their life and repayment of the amount of the bond at maturity.

 

Bonus issue

The issue by a company of new shares which do not require any payment to be made by the shareholder. This has the effect of making the company's shares more marketable because of the increased number available and the lower market price.

 

Bonus shares

It is the issue of new fully paid-up shares to existing shareholders on a pro-rata basis. The impact of a bonus issue is to reduce the share price as the same market capitalisation of the company is spread over a larger number of shares, which in turn benefits the liquidity of the scrip.

 

Book Value Per Share

Equity Shareholders Funds divided by Shares in Issue

 

Broker (see Stockbroker)

 

Broker/Dealer

An Exchange member firm, which provides advice and dealing services to the public and can deal on its own account.

 

Broker To Broker

The transaction was between two member firms where neither firm is registered as a market maker in the security in question and neither is a designated fund manager.  Brokers may also apply this indicator when buying or selling domestic equity market securities through a broker, which is not a member firm.

 

Bull

An investor who buys a security in the hope of selling it at a higher price, as he thinks the market will go up. A bull market is a rising market in which bulls would prosper.

 

Business day

Any day upon which the Exchange is open for business.

 

Buy/sell percentages

The total volumes on each side of the order book expressed as percentages in real-time.

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