Glossary of Terms

Amex Abbreviation for American Stock Exchange, Inc. Annuity A contract sold to an individual by an insurance company which is designed to provide payments to the holder at specified intervals, generally after retirement. Arbitrage Attempting to profit by simultaneously purchasing and selling the same or equal securities in a manner which takes advantage of price differences prevailing in different markets. Arbitrageur Someone who practices arbitrage. Asset Allocation The process of dividing investments into different categories, such as stocks, bonds, cash and real estate. At the Close Order An order which is to be executed as close to the end of the trading day as possible. At the Market An order to buy or sell immediately at the currently available price. At the Money Option An option with an exercise price equal to that of the underlying security. At the Opening Order An order to buy or sell at a limited price on the initial transaction of the day. Authorized Stock The maximum number of shares a corporation is permitted to issue. Average A select sampling of stocks used to reflect the basic trends of the market or a specific portion of the market, for example the Dow Jones Industrial Average. The average is derived by taking the sum of the market value of the selected stocks and dividing that number by the number of issues or by a divisor that allows for stock splits or other changes in capitalization. Backing Away When an over-the-counter market marker refused to honor his quoted bid and ask price for at least 100 shares or 10 bonds. This practice is illegal as defined by the NASD Rules of Fair Practice. Balance Order The pairing off of buy and sell orders of the same security to determine the net balance of securities to receive or deliver. This information allows the market to be opened appropriately. Bar Chart A chart used to plot stock movements using vertical bars to indicate prices. Bearish Used to voice an opinion in the belief that the stock market or some aspect of it is going to decline in price. Bear Market A market where the dominating trend is one of falling prices. Big Blue Nickname for the IBM Corporation. Derived from the color of their logo. Big Board Nickname for the New York Stock Exchange. Black Monday A name given to October 19, 1987, when the Dow Jones Industrial Average dropped a record 508 points which represented a decline of almost 23%. Block A large amount of securities, typically defined as a minimum of 10,000 shares or $200,000. Block Trade A large trade typically defined as a minimum of 10,000 shares or $200,000. Blue Chip Stock A stock that is from a well known, stable, prestigious company with a long and successful track record of profit growth and dividend sharing. Bottom Fishing Investing in stocks whose prices have dropped dramatically based on the belief that the stock has reached bottom and will now rebound. Breadth Index The percentage of securities that advanced or declined during a given day's trading. Breakout Used to describe when a security rises above or falls below a particular level, generally it's previous high or low point. Brick and Mortar A financial institution that has a physical location but has not yet established a presence on the Internet. The term is considered slightly derogatory. Bullish Used to voice an opinion in the belief that the stock market or some aspect of it is going to rise in price. Bull Market A market where the dominating trend is one of rising prices. Buying Power The amount of additional securities that a customer may purchase using the existing equity in his account. Buy Stop Order A buy order which is not to be executed until the market price reaches the customer's defined price, known as the stop price. When this occurs, it becomes a market order. Called Away Describes a stock option that was sold because the stock was at or above the strike price. Call Option A call option establishes the right to buy a specified quantity of the underlying security at a specified price any time during the duration of the option. You would buy a call option if you expect prices to rise. Cash Cow A business that generates a steady flow of cash. CBOE Abbreviation for Chicago Board of Options Exchange. CBOT Abbreviation for Chicago Board of Trade. CME Abbreviation for Chicago Mercantile Exchange. Central Bank Used to describe the primary monetary agency in a country. In the United States, it is the Federal Reserve System. Chicago Board of Options Exchange An exchange where stock options, index options, equity LEAPS and interest rate options are traded. Chicago Board of Trade An exchange where gold, grain, Treasury Bond futures and options are traded. Chicago Mercantile Exchange An exchange where financial futures, commodity futures, foreign currency futures and futures options are traded. Chippies Brokers which trade on the ECN usually in small share sizes who are prone to panic during reversals of short term trends. Churning When a broker processes excessive trades, regardless of the clients best interest, in an attempt to maximize commissions. This practice is illegal as defined by the NASD Rules of Fair Practice. Circuit Breaker When a halt to trading is implemented for one hour by a major stock or commodity exchange when an index falls a predetermined amount in a session. This is done to prevent further losses. Click and Mortar A financial institution that has both a physical location as well as an Internet presence. Climax Buying/Selling A significant price change of a security accompanied by large volume. The price should gap indicating the completion of the cycle. Commodity futures A contract to buy or sell a commodity at a specific price and on a specific delivery date. Common Stock A securities holding that affords the possessor to have ownership in the company which provides benefits such as voting rights and dividend sharing. In the event of liquidation, the rights of common stock holders come after all other holders, such as bond, debt and preferred stock. Consumer Price Index An inflationary indicator that measures the change in the cost of goods and service that the average consumer purchases. Covered Call Writing Writing a call for shares of stock that you own. CPI Abbreviation for Consumer Price Index. Day Order A transaction order that is valid only for the day on which it was entered. Day Trading The practice of buying and selling a security on the same day. Dead Cat Bounce A quick, moderate rise in the price of a stock following a major decline. Deep in the money option A call option with a strike price that is significantly below the market price or a put option with a strike price that is significantly above the market price. Deep out of the money option A call option with a strike price that is significantly above the market price or a put option with a strike price that is significantly below the market price. Delayed Opening An intentional delay in the start of trading in a stock until a large imbalance in buy and sell orders is eliminated. Delta The change in price of a call option in relation to the change in price of the underlying security. Descending Tops A chart pattern where each new high price for a security is lower than the previous high. Dip A small temporary drop in price during an overall upward trend. Divergence in Charting When two charting lines are heading in opposite directions, generally after a cross-over point. Diversification Investing in a wide variety of investments so as to reduce overall risk. Double Bottom When a security has twice declined to its support level. Double Top When a security has twice risen to its resistance level. Double Witching The 3rd Friday of months during which both options and futures expire. Dow Jones Averages The most widely used Averages to track overall market conditions. There are four Dow Jones Averages: Industrial, Transportation, Utilities, and Composite. The Composite is simply the previous three combined. Dow Jones Industrial Average The single most widely used average. It is a price-weighted average of 30 actively traded blue chip NYSE stocks. It is thought to give one of the best overall indications of stock market conditions. Downtick A transaction where the stock price is lower than the previous transaction. Dow Theory A theory which is based on the belief that the fluctuations in the stock market are both a reflection of current business trends as well as a predictor of future business trends. Due Diligence The process of researching a stock before buying it. Due Diligence is comprised of things such as checking a company's valuation ratios, business history, basic operations and technical indicators. Earnings Per Share Total earnings divided by the number of shares outstanding. ECNs Electronic Computer Networks that link buy and sell stock orders. Elliott Wave A theory of price movement cycles identified by Ralph Elliott. This theory claims that the stock markets follow a pattern of five waves up and three waves down. In the case of a particularly bear market, it would be three waves up and five waves down. EPS Abbreviation for Earnings Per Share. Ex-Dividend A security which will trade without the inclusion of a pending dividend. Therefore, the seller will be receive the dividend, not the buyer. In the newspaper, these securities are usually designated with an X beside their names. Ex-Dividend Date The date at which the Ex-Dividend period begins. Usually two days before the record date. Exercise Date The date when the sale or purchase of an option occurs as agreed upon in the contract. Expiration Date The date on which an option becomes worthless if not exercised. Fair Market Value A price that both the seller and buyer agree represents a valid price based on current market conditions. Fibonacci Numbers A sequence of numbers where the next number in the sequence is equal to the sum of the previous two numbers. For example, 5, 10, 15, 25, 40, 65. Fill or Kill Order An order which must be executed in its entirety or canceled completely. Flipping The act of buying initial public offerings at the offering price and then quickly reselling them to retail investors once trading has begun, usually for a large profit. Float The number of shares of a common stock that are outstanding and therefore available for trading by the public. FOK Order Abbreviation for Fill or Kill Order. 401(k) Plan A defined contribution plan offered by a corporation to its employees, which allows employees to set aside tax-deferred income for retirement purposes. 403(b) Plan A defined contribution plan offered by a non-profit organization to its employees, which allows employees to set aside tax-deferred income for retirement purposes. Free Riding The rapid buying and selling of a security without any intention of paying for the transaction. This practice is illegal. Fundamental Analysis A method of determining a securities value based on the analysis of several factors, such as a company's earnings, sales, assets and growth potential. Futures A contract which requires the delivery of a commodity at a specific price on a particular date in the future. Gap When the range of a stock price on two successive days does not overlap. Gap and Trap The price of a stock gaps, buyers purchase the stock. Market makers bring the stock price down, thus trapping the buyers who bought at the higher gap price. Going Public When a private company first offers shares to the public. Good till Canceled Order An order which remains valid until executed or canceled by the customer. GTC Order Abbreviation for Good till Canceled Order. Hammering the Market Excessive sale of stocks which drives the market down. Head and Shoulders A chart pattern in which there are three successive rallies which form the outline of a person's upper torso. This pattern is used to alert investors that a stock price could be headed for a fall. Hedge Taking an investment position in which some investments are designed to offset the risk of others. House Call A call from the brokerage to the customer requesting that the customer deposit additional funds into their account in order to return the balance to its required level. Index A select sampling of stocks used to reflect the basic trends of the market. Indexes are derived from a broader number of stocks than Averages. Index Fund A mutual fund that tries to mirror the performance of a specific index. Index Options An option whose security is an index. Indicator Statistics which provide an indication of the trends of the financial world or the economy in general. Initial Public Offering The first issue and sale of stock by a company to the public. Insider A person who is privy to corporate information that is not available to the general public. Institution A large organization which is in the business of investing in securities. Institutional Investors An entity with a considerable amount of money to invest. In the Money Option A call option where the strike price is less than the market price or a put option where the strike price is greater than the market price. Intraday Within a single day. Intrinsic Value The amount of money that an option is worth if it were exercised. Investment Advisor A person or an organization which has the right under the Investment Advisors Act to manage the investments of a third party. Investment Advisors Act A law which states that all investment advisors must register with the SEC. Investment Banker An individual or institution which provides services, such as underwriting and counseling, but does not accept deposits or make loans. IPO Abbreviation for Initial Public Offering. Island ECN Currently, the second largest ECN. It is used primarily by day traders. ISLD Abbreviation for Island ECN. LEAPS Abbreviation for Long-term Equity Anticipation Securities. Level I An informational screen which shows current bid and ask price. Level II An informational screen which shows, in addition to the current bid and ask price, all market makers and ECNs at different price levels on the bid and ask. Leveraged Buyout Taking over a controlling interest in a company, using primarily borrowed money. Limit Order An order in which the customer sets a maximum price he is willing to pay as the buyer or a minimum price he is willing to accept as the seller. Limit Price The price specified in a limit order. Limited Partnership A business partnership comprised of at least one general partner and at least one limited partner. The general partner operates the day to day business and assume legal debts and obligations. The limited partner is only financially liable up to the point of his investment into the business. Liquidation The closing out of a securities position. Liquidity The ability of an asset to be easily converted into cash. Also, the ability of the market to absorb a reasonable amount of trading at reasonable price changes. Listed Stock A stock that is traded on a major exchange. Locked Market A highly competitive market in which the bids and prices are the same. Lockup Period A period of time when a company first goes public during which major shareholders are prevented from selling their shares. Long-term Equity Anticipation Securities Long-term stock or index options, with expiration dates up to three years away. Long-term Gain A capital gain on an investment which was held for a minimum of six months. The profit is subject to long-term capital gains tax, which is usually a lower tax rate than that on a short-term gain. Maintenance Call A call from the brokerage to the customer requesting that the customer deposit additional funds into their account in order to return the balance to its required level. Manipulation Attempting to affect or control the price of a security through aggressive trading. This practice is illegal. Margin The amount of money that a customer must deposit with a broker to secure a loan from that broker. In the case of futures, the amount of money that must be deposited to protect the buyer and seller from default. Margin Call A call from the brokerage to the customer requesting that the customer deposit additional funds into their account in order to return the balance to its required level. Market Makers A brokerage or bank that maintains a bid and ask price in a given common stock by always being available to buy or sell at publicly quoted prices. Market Order An order to buy or sell immediately at the currently available price. Market if Touched Order An order which is to be executed if the specified price is reached. Market on Close Order An order to buy or sell which is to be executed during the closing period of the market at the best price available. Market on the Open Order An order to buy or sell which is to be executed during the opening period of the market at the best price available. Momentum Trading Short to moderate length investments that are made to capitalize on the sudden rise or drop in a stock price that follows certain technical indicators. Naked Option The writing of an option without ownership of the underlying asset. NASD Abbreviation for National Association of Securities Dealers. NASDAQ Abbreviation for National Association of Securities Dealers Automated Quotations. National Association of Securities Dealers A self regulated securities industry organization responsible for the operation and regulation of the NASDAQ stock market and over the counter markets. National Association of Securities Dealers Automated Quotations A computerized system by which NASD members can communicate bids and offers on over the counter stocks and some listed stocks. Net Charge The last column in a stock or bond table listing the difference in price between the close on that trading day and the previous day. New York Stock Exchange The largest and oldest securities exchange in the United States. No Load A purchase with no commissions charged. NYSE Abbreviation for New York Stock Exchange. OCC Abbreviation for Options Clearing Corporation. Odd Lot An amount of stock less than the normal trading unit. Odd Lot Theory The theory that odd lot investor become heavy buyers when the market is about to peak and heavy sellers when the market is declining just prior to a rally. Offering Price The price at which shares will be sold to IPO investors. Open Interest The number of contracts outstanding at the end of the trading day. Open Order An order which remains valid until executed or canceled by the customer. Opening Price The price at which an IPO starts trading on the open market. Option The right to either buy or sell a stock, commodity, currency, or index at a specified price during a specified time period. Option Chains A list of all the available options for a particular security. Option chains show items such as strike prices, expiration dates and whether the option is a call or a put. Option Cycle A series of months during which the options of a particular security expire. All options are placed in one of 3 cycles: the January cycle (January, April, July, October), the February cycle (February, May, August, November), or the March cycle (March, June, September, December). This cycle does not apply to LEAPS. Options Clearing Corporation An organization which processes and guarantees the transaction of options for the various options exchanges. Options on Futures Gives the buyer the right to buy or sell a specific futures contract at a specific price during a specific time period. OTC Abbreviation for Over the Counter. Out of the Money Option A call option where the strike price is greater than the market price or a put option where the strike price is less than the market price. Over the Counter A security that is not listed or trader on a major exchange, usually due to an inability to meet listing requirements. P/E Ratio Abbreviation for Price/Earnings Ratio. Painting the Tape A person or group making numerous trades without any real change in ownership occurring. This is done to create the impression that there is heavy activity related to the stock, thus encouraging others to trade in the stock. Paper Loss/Profit A profit or loss which has occurred but will not become actual until the security position is closed out. Paper Trade Trading stocks for pretend with no real money, to practice or test theories. Penny Stocks Low priced, high risk stocks, usually with a price of less than a dollar per share. Pink Sheets A daily listing of bid and ask prices for over the counter stocks published by the National Quotation Bureau. Plus Tick A transaction where the stock price is higher than the previous transaction. Plus Tick Rule SEC rule stating that short sales may only be made on an uptick/plus tick or zero-plus tick. Point and Figure Chart A chart which shows price movements of a security, without measuring the passage of time. Poison Pill Any action taken by a company designed to avoid a hostile takeover. For example, issuing preferred stock that can be redeemed at a premium if a takeover does occur. Portfolio All of the different investments owned by the same individual or organization. Preferred Stock A stock holding which provides a specific dividend that is paid before any dividends are paid to common stock holders. In the event of liquidation, their rights come before common stock holders, but after other holders, such as bond and debt. Price/Earnings Ratio A ration derived by dividing the market price of a company by earnings per share. This is thought to gage the value of the stock relative to current market conditions. Principals The major investors in a corporation. They, generally, have equity interest, voting privileges, access to management records as well as receiving dividends. Profit Taking Action by short-term securities traders to cash in on gains created by a sharp market rise. This results in a temporary drop in market prices. Program Trading A computerized trading system that allows for large volume securities trading. Prospectus A document required prior to an offering of securities. It must explain the offer, including the terms, issuer, historical financial statements, planned use of the money or objective as well as any other information that may be useful to an investor in determining whether to invest. A prospectus is required as a result of the Securities Act of 1933. Protective Puts The purchase of a put option at the same time as purchasing the stock defined in the put or while already owning the stock defined in the put. Proxy A person who is authorized to represent another person. For example, a person who is authorized to vote in behalf of another stockholder at a stockholder's meeting. Proxy Contest Technique used to acquire a company in a hostile takeover attempt. The group, that wishes to attempt the hostile takeover, solicits the proxy rights of other stockholders. This is done to procure a voting block large enough to facilitate a company takeover. Put Option A put option establishes the right to sell a specified quantity of the underlying security at a specified price any time during the duration of the option. You would buy a put option if you expect prices to drop. Rally A substantial rise in the price level of the overall market, following a decline. Red Herring A slang term for a preliminary prospectus. So called, because of the warning printed in red on the prospectus stating that it is still being reviewed by the SEC. Resistance Inability of a stock to rise above a certain price. This is generally due to an abundance of stock being available at that price. Reversal When the overall market changes directions after a trend in the other direction has occurred. Road Show A series of meetings with potential investors and brokers, conducted by a company which is preparing for its IPO. These meetings usually take place in several locations throughout major cities. Rolling Option Buying options on a stock which shows a consistent pattern of traveling up and down between two levels. Rolling Out Buying back an existing option and then rewriting it with an expiration date that is further in to the future and/or with a different strike price. Round Lot Shares in multiples of 100 or bonds in multiples of $1,000. Round Trip The completion of a transaction, which includes both entry into the market and exit. Rounding Bottom A chart pattern in the shape of a saucer. Suggesting a new trend upward. Rounding Top A chart pattern in the shape of an inverted saucer. Suggesting a new trend downward. Russell 3000 An index that covers over 3000 common stocks. Considered an excellent indicator of how the overall market is doing. SEC Abbreviation for Securities and Exchange Commission. Securities Act of 1933 The first federal legislation designed to regulate the securities industry. It requires registration, as well as mandates that accurate information be made available to prospective stock purchasers. Securities and Exchange Commission The government agency responsible for regulating and supervising the securities industry. Securities Exchange Act of 1934 The act which created the SEC. In addition, it outlawed unfair and abusive practices in the issuance of securities, required registration of exchanges, brokers, dealers and listed securities. Securities Investor Protection Corporation A non-profit corporation formed by the Securities Investor Protection Act of 1970 which insures brokerage accounts up to $500,000 per customer, only $100,000 of which may be in cash equity, in the event of brokerage bankruptcy. SelectNet A system that facilitates sending of orders directly to market makers. Market makers can accept reject or counter with a new order offer. Selling Off Selling securities to prevent losses from continued price declines. Selling on the Good News Selling a stock right after good news has driven the price very high. Sell Stop Order A sell order which is not to be executed until the market price reaches the customer's defined price, known as the stop price. When this occurs, it becomes a market order. Share A certificate representing one unit of ownership in a corporation. Short against the Box A short sale of a security in which the seller still owns a long position on the same security. Thus, the overall position on the security is not closed out. This is done to defer tax liability. Short Interest The total number of shares of a security that have been sold short and not yet repurchased. Short Interest Theory The belief that an increase in short interest indicates a bullish condition and a decrease in short interest indicates a bearish condition. Short Position The position that results from short selling that has not yet been covered. Often defined in terms of the number of stocks that are sold short. Short Sale Borrowing a security from a broker and selling it, with the understanding that it must later be bought back and returned to the broker. The SEC regulates that a short sale may only take place on an uptick/plus tick or zero-plus tick. Short Selling Power The dollar amount of securities a customer may legally sell short without depositing additional funds in to their account. Short Squeeze When the price of a stock rises and investors who sold short rush to buy it to cover their short position and cut their losses. This, in turn, drives the stock price higher, which results in even more short sellers feeling compelled to cover their positions. Short Stop Order A limit order to sell short that is only executed if a transaction is created that is below the customer's set price. Short Term Capital Transaction The selling of a security that was held for less than six month. Short-term Gain A capital gain on an investment which was held for less than six months. The tax rate on a short-term gain is usually higher than that of a long-term gain. SIPC Abbreviation for Securities Investor Protection Corporation. Small Order Execution System An automated execution system for bypassing brokers when processing small orders of securities up to 1,000 shares. This system applies only to NASDAQ stocks. SNET Abbreviation for SelectNet. SOES Abbreviation for Small Order Execution System. Specialist A stock exchange member who specializes in particular securities. The specialist must maintain an inventory of those securities and be available to buy and sell shares as necessary to equalize trends and provide an orderly market for those securities. Specialist Book The chronological record of inventory and transactions made by the specialist. This is not a publicly available record. Split The division of the outstanding number of shares into a higher number of shares. The market price per share drops proportionately. This is generally done to make a stock with a very high price more accessible to small investors. Current owners of the stock maintain the same equity by receiving the proportionate number of additional shares. Spread The difference between the bid and the ask price. Standard Deviation A statistical measure of the volatility of a mutual fund or portfolio. Stick One dollar. Stock index future A contract reflecting the market price of a selected group of common stocks. These stock index futures represent a wide range of stocks and therefore reflect the overall movement trends of the market. Stocks A certificate that signifies an ownership position in a company. Stone One thousand dollars. Stop Limit Order A order to buy or sell which is not to be executed until the market price reaches the customer's defined price, known as the stop price. When this occurs, it becomes a limit order. Stop Loss Order A sell stop order for which the specified price is below the current market price. Done to prevent further losses or to lock in profits. Stop Order A buy or sell order which is not to be executed until the market price reaches the customer's defined price, known as the stop price. When this occurs, it becomes a market order. Straddle The simultaneous purchase of an equal number of puts and calls, with the same strike price and expiration dates. Street Name Securities that are held in the name of a brokerage on behalf of a customer. Strike Price The specified price at which a call option buyer can buy the underlying security or a put option buyer can sell the underlying security . Subsidiary A company in which a majority of the voting shares are owned by another company. Support A tendency for a stock not to fall below a certain price. This is generally due to the stock being in short supply at that price. Switch Order An order to sell one security and buy another. Generally, the proceeds from the sale of the first security is used to finance the purchase of the second. Tax Basis Purchase price of a property, used to determine capital gains and capital losses for tax purposes. Technical Analysis Analyzing previous market trends and stock prices in the belief that done properly it can be an indicator of future trends. Teenie 1/16th. Tender Offer A public invitation to stock holders to sell their stock, generally, at a price above the market price. This is done primarily in relation to a takeover. 10-K A report at the end of a company's fiscal year that must be filed with the SEC. The report contains in depth statistics on finance as well as operations. Thin Float When only a small number of shares of a common stock are still available on the market. Ticker Symbol A system of letters used to uniquely identify a stock or mutual fund. Time of Sales The actual time and price of transactions as they occur. This information is present on a Level II screen. Time Value The difference between an option's intrinsic value and the current market price. The hope being that the intrinsic value over time will go above the market value. Tombstone An advertisement in a business newspaper or magazine, used to make a public offering. Generally, the information is presented in a straightforward and somewhat dull fashion. TOS Abbreviation for Time of Sale. Trading Index A calculation which takes the number of advancing stock and divides it by the number of declining stocks. A result of less than 1 is considered bullish, greater than 1 bearish. Trailing Stops A stop loss order that is to be executed when a stock being followed up, dips down below a specified amount or when a stock being followed down, goes up above a specified amount. TRIN Abbreviation for Trading Index. Triple Bottom A chart pattern which shows that a stock has attempted to penetrate a lower price level on three different occasions. Triple Witching Hour The hour before the market closes on the third Friday of March, June, September and December, when option contracts and futures contracts expire on stock indexes. This, usually, results in a very high level of trading on those contracts as well as the underlying securities. Uncovered Call Writing A call option where the writer does not own the common stock represented by the option. Uncovered Option The writing of an option without ownership of the underlying asset. Uncovered Put Writing A put option where the writer does not have a corresponding short position. Undervalued A security which has a price that is below its perceived value. Underwriter An individual or institution which acts as a middle man between corporations issuing securities and the investing public. Uptick A transaction where the stock price is higher than the previous transaction. Uptrends Any upward movement of a security's price. Can also be applied to the overall market. Volume The number of shares or bonds traded during a defined period. Warrant A certificate that is issued along with a stock purchase, which entitles the holder to buy a specific amount of reserved securities at a specific price, usually above the current market price. The certificate is valid for an extended period of time, generally no less than five years. Wash Sale To sell a security at a loss and then repurchase that same security within thirty days. This is generally done in an attempt to use the loss to offset capital gains. However, if noted, the IRS will not allow the loss to be claimed. Watered Stock Stock that is issued by a company that has not increased its capital worth. White Knight An investor who prevents a hostile takeover, by taking over the target company himself. Wilshire 5000 An index that covers approximately 5000 stocks from the largest companies in the United States. Writer Someone who sells an option. Zero Minus Tick A transaction where the stock price is equal to the price of the last transaction but lower than the last different price. Zero Plus Tick A transaction where the stock price is equal to the price of the last transaction but higher than the last different price.