4-X is a special trading segment of the Baden-Württembergische Wertpapierbörse (Baden-Württemberg Stock Exchange) for foreign securities. Foreign securities can be listed in 4-X in accordance with fixed regulations in the exchange rules, irrespective of whether the securities are listed or included in the Regulated Market (Geregelter Markt) or the Open Market (Freiverkehr), at the Baden-Württembergische Wertpapierbörse. These regulations stipulate quality standards for the trading of foreign securities, ensuring that the securities are continually traded at fair and transparent prices.

A bank that is authorised to hold and manage securities for third parties.

Actual price paid for the acquisition of a security. The acquisition price amount has an influence on yield.

The German Securities Trading Act obliges issuers to undertake "ad hoc publicity", the immediate publication of important news relating to the company, which could have a considerable influence on the stock exchange price. The news must first be reported to the German Federal Supervisory Authority for Securities Trading and the Exchange Operating Boards, which decide whether the share trading must be suspended.

American Depository Receipts. These are "deposit receipts for shares", which are traded instead of the actual share.

AG stands for "Aktiengesellschaft" (public company).

Abbreviation: AG. An AG is a company in which shareholders invest by purchasing shares of the share capital of this company. The shareholders are liable only to the level of their investment but not with other assets. The motivation behind and purpose of an AG is to acquire greater capital for investments etc and to distribute the business risk as widely as possible by issuing shares.

The highest price ever paid or a historical high is known as an "All Time High". Opposite of -> All time low

"All time low" refers to the lowest market level or price level of all time. Opposite of All time high.

The Amtlicher Markt is an organised market in line with the WpHG (German Securities Trading Act). The admission requirements, the obligations of the participants and the organisation of trading are governed by law. A company must complete an admission procedure regulated by public law before commencing trade.

The most comprehensive trade of securities on the German stock exchanges is Amtlicher Handel (Official Market). Companies which are listed to trade shares after undergoing a strict procedure are subject to publication requirements. In addition to the Board of Directors of the stock exchange official brokers are responsible for determining rates. Prices are published in a price list.

An analyst assesses the investment quality and price prospects of securities. The analysis is published in analysts' reports.

The Annual General Meeting is the meeting of -> shareholders, which usually takes place once a year and during which they exercise their rights. All shareholders are allowed to participate. The decisions made by the Annual General Meeting include the appropriation of profit, any capital increases, and the discharge of -> the Board of Directors and -> the Supervisory Board. The Annual General Meeting selects the auditor for the annual financial statements and elects the shareholder representatives to the Supervisory Board. It is solely responsible for discharging the Supervisory Board and the Board of Directors (see also -> voting right). The proposed agenda is published in the invitation to attend the Annual General Meeting.

Annual statement of accounts by an Aktiengesellschaft on the business development and the position of the company. The Annual Report publishes and explains in detail the annual financial statements with the balance sheet and the profit and loss statement.

Arbitrage refers to the price difference between shares at e.g. different stock exchanges which is achieved to make a profit. The balancing effect of arbitrage adapts the prices at different stock exchanges.

Legal basis of an Aktiengesellschaft, consisting of the company and headquarters, business purpose, share capital amount and other fundamental regulations (e.g. with regard to -> the Board of Directors and -> the Supervisory Board).

(An offer or asking price) The price at which an investor is prepared to sell a security. Opposite: bid.

(Ask). Price at which securities, currency, raw materials etc are offered for sale (-> bidding prices).

All assets of a company listed on the company's balance sheet and compared to liabilities.

The ATX is the Austrian Traded Index, the stock exchange index of the Vienna Stock Exchange. It comprises the prices of the 21 (as at Jan 2006) largest Austrian companies and is calculated on each stock exchange trading day. The number of individual shares is based on their market capitalisation. The ATX started trading on 2 January 1991 at 1000 points.

The Bundesanstalt für Finanzdienstleistungsaufsicht, the German Federal Financial Supervisory Authority (BaFin), was created on 1 May 2002 as the institution to replace the German Federal Banking Supervisory Authority (BAKred), the German Supervisory Authority for Securities Trading (BAWe), and the German Federal Supervisory Authority for Insurance Enterprises (BAV).
The BaFin is a single, government supervisory authority for the area of finance, consisting of banks, insurance, securities trading banks and financial service providers.

A sustained, general fall in prices on the stock exchange. From the French "baisser" (=to lower, fall). Also known as a Bear Market  (-> bearish). Opposite of - Hausse

Comparison of the assets and capital (liabilities) of a company at a specific time. The assets show the use of financial funds, capital shows claims of creditors (external funds) and company owners (equity) to the assets (origin). The balance sheet is - together with the other elements of the annual financial statements - an important instrument for the assessment of the situation and development of a company. The balance sheet ratios, the ratios between assets and liabilities, are therefore one of the most observed criteria in fundamental analysis.

Securities, for which the shareholders' rights can be exercised by the person named on the certificate. They can be transferred by mutual consent and with transfer of title.

Stock exchange jargon for an anticipated fall in prices. On the stock exchange, the bear is the animal that pushes the prices down with its paws (-> Baisse). Opposite of -> bullish.

A measure of the fluctuation of the share price in comparison to the overall market (represented by a -> share index). A beta of 1 means that the risk of price fluctuation of the share is the same as that for the overall market. A beta of 1.2 means that the risk of price fluctuation of the share is 20% higher than that for the overall market.

-> Bidding price

On the stock exchange, the Big Bang refers to the stock exchange reform in London on 27 October 1986, after which London became the third largest stock exchange in the world. This enabled London to achieve its target of becoming an important stock exchange alongside New York and Tokyo.

Stock exchange term for a share in a large company of high international standing with particularly high assets and earnings.

Management and representative body (company management) of the Aktiengesellschaft with responsibility. In addition to management and reporting, the legal and non-legal representation of the AG is one of the most important duties of the Board of Directors. The Board of Directors is appointed and recalled by the -> Supervisory Board of the AG.

Spanish Stock Exchange, Madrid. Index Ibex 35.

Method to determine a market-based issue price for a new admission to the stock exchange: Potential -> institutional investors announce which volumes they would buy at which prices within a defined price range. This fictitious order book is used to determine the issue price and issue volumes. In contrast, the issue price is determined exclusively by the issuing bank or issuing consortium and the issuer in the conventional fixed price procedure.

Italian Stock Exchange, Milan. Index: MIB 30.

A person who deals in securities and (in contrast to a trader) executes stock exchange transactions for a third party, e.g. on behalf of a customer.

Stock exchange jargon for an anticipated increase in prices. On the stock exchange, the bull is the animal that takes the prices by the horns and sends them into the air (Hausse). Opposite of bearish.

CAC 40 is the index of the French Stock Exchange and contains the 40 leading public companies. CAC stands for Cotation Assistée en Continu (continuous listing).

In stock exchange terms, a call is a "call to buy an option". The buyer of the option pays the seller a premium and obtains the right to purchase a certain number of shares for a pre-determined price on an agreed date. The seller must deliver the shares at this exact price on this date if the purchaser exercises the option.

The term "capital increase" refers to the increase in the share capital of an Aktiengesellschaft by issuing new shares. A capital increase is often used to finance investments or the acquisition of companies. The statutory subscription right guarantees shareholders the right to maintain their investment stake in the company by participating in the capital increase, i.e. by buying new, additional shares.

Share capital of an Aktiengesellschaft, representing the value of all issued shares in numbers. Listed as subscribed capital under liabilities on the balance sheet.

An important figure in the assessment of the financial power of a company. Cash flow is the balance of company income and outgoings and explains the use of funds.

Processing company (Centrale de Livraison de Valeurs) for the administration, safekeeping and processing of securities, headquartered in Luxembourg -> today Clearstream

Graph representing the price and sales development of securities and sectors. Charts form the basis for the technical analysis of securities.

Frequently used as a synonym for the technical analysis of securities. The chart analysis is based on the assumption that the past price and trading trends can be used to predict the future development of a security.

Formerly Cedel, clearing company in Luxembourg.

Collective custody refers to the administration and holding of a securities account by a securities clearing and deposit bank.

Prescribes a binding code of conduct for banks, insurance companies and pension funds, which primarily aims to avoid conflicts of interest.

Stabilisation of the stock exchange prices after a sharp rise or fall in prices. Due to its appearance in a chart (graph representing price movements), it is also known as a sideways movement.

A company founded for a limited period of time to carry out one or several defined transactions. Frequently occurring consortiums are issue consortiums to place new shares on the capital market.

Increase of the share capital of an AG, which is only to be carried out by using conversion and subscription rights, which the company grants to the new shares (subscription shares).

Fees payable to the account holding bank for holding securities.

Shares in companies whose sales and profit development is largely dependent on the economic situation. The selling price of cyclical shares is mostly based on a certain waiting period in line with the economic situation.

Abbreviation for the Deutscher Aktien Index (German share index). The DAX comprises the 30 largest Aktiengesellschaften. Their price development flows into the index, weighted according to the market capitalisation of the free float. The DAX is the leading index for the development of the German stock market. In addition to the DAX 30, there is a range of other DAX indices, e.g. the DAX 100 (the top 100 shares), the MDAX (for mid-sized shares) and the CDAX (sector indices).

In banking and stock exchange terminology, derivatives are products which derive their market value from the classic underlying values (such as shares, bonds or gold). Derivatives include tradeable financial products such as futures, options, certificates and non-standardised financial products such as forwards or swaps.

A financial provider, who places fixed prices for a share in the Xetra system and thereby ensuring that there is liquidity.

Deutsche Börse AG, headquartered in Frankfurt am Main, operates the public FWB® Frankfurt Stock Exchange. In this role, it secures the functioning of stock trading. The Frankfurt Stock Exchange is one of the world's largest trading places for securities, together with Berlin-Bremen, Dusseldorf, Hamburg, Munich and Stuttgart. Deutsche Börse AG also provides additional financial services.

A stake in the profit distribution of an AG relating to a share. The dividend amount is decided by the Annual General Meeting following a proposal by the Board of Directors and the Supervisory Board. Dividend depends on the general business situation of the AG and is therefore subject to fluctuations. German companies pay out once a year but this is not necessarily the same abroad: US companies generally pay out quarterly dividends four times a year.

Figure for the percentage share of the profit paid out by an Aktiengesellschaft on the share price.

The most observed share index in the world. The "Dow" is calculated by adding the prices for 30 of the most important US industrial companies and then multiplying them by a factor, which is adjusted to be lower after every spilt in one of these companies. In contrast to most of the other share indices, the individual shares in the Dow Jones Industrial Average are not weighted according to market capitalisation.

The Society of Investment Professionals in Germany (DVFA) is the professional association of capital market experts, which aims to safeguard quality standards on the capital market and to create confidence in the capital market among international investors. Economists and managers in Germany have joined forces in the Schmalenbachgesellschaft-Deutsche Gesellschaft für Betriebswirtschaft e. V. (SG-DGfB e. V.) to promote dialogue between business research and business practice. DVFA and SG have shared standards for the calculation of annual earnings (Earnings according to DVFA/SG) and -> Cash flow.

Annual earnings adjusted for extraordinary, unusual and management-related expenditure. The method was developed by the Method Commission at the DVFA and the External Company Accounting Work Group of Schmalenbach-Gesellschaft-Deutsche Gesellschaft für Betriebswirtschaft e.V. (DVFA/SG).

One of the most important figures in fundamental share analysis. The profits generated by the company within a certain period of time (quarter, financial year) after tax are divided between the average number of shares issued by the company. Earnings per share primarily serves as a comparison with various companies in the same sector and for the analysis of the earnings situation of an individual company over time. The English abbreviation EPS is used widely. Earnings per share are not identical to dividend.

Earnings Before Interest and Taxes.

Earnings Before Interests, Taxes, Depreciation and Amortisation refers to the operating result before interest, taxes, deprecation of tangible assets and amortisation of intangible assets.

The theory of the efficient market says that stock exchange prices develop in line with the real economic conditions. New information relevant to prices is immediately included in price determination.

Collective term for young, emerging economies in Latin America, Asia and Africa.

The Entry Standard was introduced as part of the Open Market (Freiverkehr) and as an alternative capital market access to the EU-regulated segments of the Frankfurt Stock Exchange on 25 October 2005.

International term for earnings for each share after tax.

In contrast to external funds, all funds which are contributed by the owners of a company to finance it or which are left from the profit generated by the company.

Assets managed by an investment company are known as equity funds. In these investment funds, the capital is mostly invested in shares.

Method used in consolidated financial statements to evaluate investments in associated companies, joint ventures and Group companies, which have not been consolidated in full due to a consolidation ban or by exercising a consolidation option. In contrast to evaluation according to the historical costs principle, the book value of an investment is continually adapted in line with the development of equity in the companies concerned.

EUREX is the largest options and futures exchange in the world and is operated by the Deutsche Börse AG Group and SWX Swiss Exchange. This is where all types of derivatives are traded and processed.

In order to have an orientation amount for the European market, the German Stock Exchange developed the European "Stoxx Family" share index together with the Swiss Stock Exchange, the Bourse de Paris and the Dow Jones in the US. It consists of the two overall Dow Jones indices: the Dow Jones Stoxx, which covers 666 companies from 16 European countries, and the Dow Jones Euro Stoxx, which lists the shares of 326 companies in the European Monetary Union, and the two "blue chip indices": the Dow Jones Stoxx 50 with the shares of 50 companies from all over Europe and the Dow Jones Euro Stoxx 50 with the shares of 50 companies from countries within the European Monetary Union.

The day on which a security is traded without e.g. dividends or other capital measures.

Sum of all the liabilities of a company, liabilities minus equity, possibly after value adjustments. According to their terms, external funds are distinguished as short-term (e.g. bank loans, bills payable) and long-term (e.g. bonds, long-term loans). The costs of external funds are an influencing factor on the costs of capital for a group.

Stock exchange market for fixed-interest securities. Measured by sales, the number of listed securities and new issues, the fixed-income securities market is more important than the > stock market  (-> securities market)

(-> Free float of stock)

The free float of stock is the percentage share in a company which is free to be traded on the stock exchange.

Period in which a security (share) is not permitted to be sold.

Unlike the Amtlicher Markt and the Geregelter Markt, the Open Market is both a private segment but also an organised market in terms of the WpHG (German Securities Trading Act). However, the admission requirements for the companies are easier than those for the two EU-regulated segments, the Amtlicher and Geregelter Markt. The Freiverkehr was renamed the Open Market in October 2005.

Share index at the London Stock Exchange, which lists the top 100 leading equities in the United Kingdom.

GDRs are certificates that document a certain number of securities. They are issued to enable a security that cannot be traded as an original to be listed on a stock exchange.

The General Standard is one of the EU-regulated segments and is the segment with the minimum legal requirements for the Amtlicher Markt or Geregelter Markt.
The General Standard is suitable for companies that appeal to national investors. German companies are automatically included in the CDAX®.

Refers to German certificates, which are traded alongside the original foreign share and any ADRs.

A certificate that documents all classes of securities of a company. Physical securities are no longer issued.

When a company enters the stock exchange, this is referred to as "going public". The securities (shares) are listed in a trading segment such as the Amtlicher Handel (Official Market), the Geregelter Markt (Regulated Market) or Freiverkehr (Open Market). The opening price on admission may differ to the issue price. In addition to accessing the capital market as a source of income, the main reasons for a company to be listed on the stock exchange are the effects in terms of publicity and image.

A green shoe option is a clause in an issue underwriting agreement, in which the consortium authorises the issuer to distribute additional shares in the event of exceptional public demand.

Stock exchange term for shares in a sector (or a company), which are estimated to have above average fundamental prospects in the long-term.

A strong, sustained long-lasting rise in share prices. Opposite of Baisse.

Hedge funds are funds that hedge an underlying, second investment against different risks (e.g. interest rate and currency risks).

IAS is the abbreviation for International Accounting Standards, standards which are prescribed by the International Accounting Standard Committee (IASC). The IASC is formed of auditors, financial analysts and compilers of annual financial statements.

Share index of the Spanish Stock Exchange in Madrid, the Bolsa de Madrid. The Ibex35 lists the 35 biggest Spanish public companies, weighted according to market capitalisation.

Insider information is information on confidential facts relating to a security or an issuer which could have a considerable influence on the price of the security if it was announced to the public. The use of insider information, e.g. to buy or sell securities is prohibited under the German Stock Exchange Act and is a criminal offence.

People who receive information about an Aktiengesellschaft that is relevant to prices before the public. To use this position to gain an advantage in stock exchange transactions is a criminal offence.

Alongside professional traders and private investors, institutional investors represent the third group of investors in the stock exchange. Institutional investors generally include insurance companies, pension funds, large asset managers, asset management companies and sometimes banks, who all invest large sums of money on a regular basis in an attempt to make a profit.

Price for the loan of capital.

A withholding tax on domestic interest revenue (usually 30%), which has been collected by banks and forwarded to the Tax Office directly since 1 January 1993. This investment income tax levied at source is an advance tax payment. It is calculated based on the overall income tax owed by the taxpayer. The tax is only deducted when the relevant exemption amount has been exceeded. However, the pre-requisite for this is that the taxpayer has provided his/her bank with an appropriate exemption certificate. The exemption amount can also be divided between several banks.

A special form of income tax. On payment of a dividend, at least 25% of the amount paid is retained as investment income tax in the event that the account holding bank has not been provided with a tax exemption request or a relevant exemption amount is no longer available. This tax deduction is calculated as an advance payment of the shareholders' income tax.

Investor relations comprises all measures to maintain relations with existing and potential investors. Investor relations activities aim to create a basis of trust with the investors, to increase or stabilise the share price and to raise awareness of the company.

Initial Public Offering (IPO) is the organisational implementation of the "going public" of a company by issue banks. Shares are offered to interested parties for purchase for the first time. This can be as a capital increase or a new placement.

Individual identification numbers for securities, which are used in computer recording of securities on an international basis.

Specialist term for the distribution of shares.

The price at which a share is issued by an Aktiengesellschaft during a capital increase or listing on the stock exchange.

Customary term for shares in large companies with strong growth and earnings and high market capitalisation. (-> Blue chips).

-> Quarterly Report

Admission/listing of a share on a stock exchange (see -> stock market flotation, IPO).

The application for the listing of securities for trading on the stock exchange must be submitted to the stock exchange by the issuer and the lead bank. The listing application must include the name of the security, the total nominal amount, the denomination etc and the prospectus. This information should show whether the security fulfils the listing criteria for the selected stock exchange segment.

On submission of the -> listing application, the documents submitted are examined by the stock exchange or their relevant committees. If all the preconditions required are fulfilled, the security is listed for trading on the stock exchange.

From a stock exchange perspective, a liquid market allows for fast and effective entry and exit at the current market price. The large number of market participants that are prepared to buy or sell enables positions to be entered and liquidated quickly. From a business perspective, liquidity (also called cash reserves) means that a company is able to fulfil its payment obligations on time.

M:access is a market segment at the Munich Stock Exchange for small and medium-sized enterprises, which is designed to be a cross-segment, stock exchange regulated market.
Admission is carried out by IPO, listing or changing from another segment. As the stock exchange takes on the follow-up obligation in this segment, companies listed in the M:access ensure a high level of transparency and security for their investors.

The margin is a collateral payment that a shareholder places for forward contracts for the event that the contract does not move in his/her favour. Margin call: if the contract does not develop in the investor's favour, he/she is called upon to pay in more collateral.

Market capitalisation shows the current stock exchange value of a company. It is calculated by multiplying the share price by the number of shares issued.

Market makers are members of the stock exchange, who maintain fixed bid and ask prices on the stock exchange. Market makers are mostly banks or brokers acting as "specialists".

Order without a specified price limit, which must be executed as quickly as possible at the best possible price.

MAX-ONE is the name of the electronic trading system at the Munich Stock Exchange. It supports the specialists in fixing prices. "MAX ONE" is a reference market principle, through which the customer receives the best available price at the Munich Stock Exchange according to specific criteria.

Share index of the Milan Stock Exchange, listing the top 30 public companies in Italy.

Morgan Stanley Capital International, a financial services provider that is also well-known in stock exchange circles due to its large number of international indices.

National Association of Securities Dealers for Automated Quotation. The NASDAQ was originally founded to obtain prices for all shares traded on Wall Street at any location in the USA. The NASDAQ has since become a trading platform for several thousand American companies.

The nominal amount states what stake of the share capital is represented by the share and therefore in the overall assets of an AG. A shareholder participates in the business success of the AG though a dividend. The nominal value was previously DM 5 or a multiple of this; the minimum nominal amount was reduced to EUR 1 with the introduction of the euro. The nominal value is not subject to stock exchange fluctuations and is therefore different to the price (see also -> No par value share).

In contrast to a share with a nominal value, the no par value share does not document a fixed amount (e.g. EUR1 per share), but a stake in the company's capital which is defined in the Articles of Association (e.g.. 1/20,000,000). No par value shares were authorised for the first time in Germany in 1998.

The addition of "NVDR" at thai shares means "non votice deposite receipt" = stimmrechtslose Aktien. In Thailand there are "foreign" shares issued for foreign investors. If these "foreign" shares are in possession of several investors the so called "NVDR" are issued next.

One of the most important stock exchanges in the world, located on Wall Street and therefore often simply referred to as "Wall Street". The official acronym is NYSE.

The first price determined for a certain security in variable price quotation after the stock exchange opens.

Generally means the contractual right to buy or sell an object under certain conditions, at a certain time and at a certain price. There are two types: call options and put options. Options can be traded independently on the stock exchange.

The right (not the obligation), to buy or sell shares at a pre-determined price at a certain time (< Strike price). If the strike price is lower than the current market value, the -> option has an accounting value.

All orders are saved in the order book of the stock exchange, checked for whether they can be carried out and executed where necessary.

Ordinary shares grant the shareholder the shareholders' rights prescribed by the German Stock Corporation Act, in particular voting rights at the Annual General Meeting. Opposite of Preferred share.

When an order is traded "over the counter". The OTC Bulletin Board is another trading platform in the USA, on which public companies are subject to less strict regulations than the NYSE or NASDAQ.

Over the counter trade is a form of securities trading which takes place outside stock exchange hours and is not permitted to take place in the stock exchange. It can take place either before or after stock exchange trading. Over-the-counter trading is used primarily by banks, insurance and investment companies for the settlement of transactions by telephone.

Stock exchange trading takes place on the Parkett (trading floor) in Germany. There are trading floors in Berlin-Bremen, Dusseldorf, Frankfurt, Hamburg, Munich and Stuttgart, whereby the market makers no longer have to be present at each stock exchange, i.e. they can sit in an office and do not have to quote prices in the stock exchange room.

Development in the value of a security. Performance is the result of price development, dividend payments and subscription rights in capital increases. It is given as a percentage relating to a specific point in time.

Abbreviation for price earnings ratio. The PER ratio is the ratio between the current share price and the annual earnings per share of the company. The lower the PER ratio, the "cheaper" the share. The PER ratio reflects investor expectations in terms of future earnings growth.

Unlike ordinary shares, preferred shares do not usually have any voting rights. However, they grant their holder other privileges such as a preference dividend or the cumulative payment of dividends due.

This is calculated by dividing the price of a share by the cash flow (financial surplus) per share. Cash flow is the most important ratio in fundamental analysis to assess the financial power of a company. Cash flow is the balance of the inflow and outflow of funds. Profit plus amortisation is referred to as cash flow in short. In relation to the share price, cash flow shows how long it takes to pay the share price from the company ongoing payment streams.

Name for the issue market, i.e. for the first issue of securities and their sale to investors.

The Prime Standard is one of the EU-regulated segments and is the listing for companies which also wish to position themselves for international investors. In addition to the General Standard, which sets the minimum legal requirements for the Amtlicher Markt or the Geregelter Markt, Prime Standard companies have to comply with high international transparency standards. Listing in the Prime Standard is a pre-requisite for inclusion in the selected indices DAX®, MDAX®, TecDAX® and SDAX®.

An interim report produced during the year on the business and earnings development of a company.

An English term, which has since become a common, colloquial term for bid and ask prices, i.e. the trading range, in Germany.

Based on the theory of the efficient market, a model to explain the price development of securities. The hypothesis states that no conclusions can be drawn with regard to future development based on observing and interpreting past price performance, as all the relevant information that was currently available has been included in the last relevant price determination. The last relevant price is thus the best possible estimate of all future prices. According to the random walk hypothesis, the technical analysis of securities does not have any relevance in terms of forecasting. Strictly speaking, no sensible forecasts can be made on future price developments using fundamental analysis methods according to this hypothesis.

Standardised figure to assess and categorise the credit rating of a company. The rating is based on analyses carried out by specialist companies (e.g. Standard & Poor's, Moody's).

In contrast to a bearer share, a share in the name of a specific natural person or legal entity. The holder is registered in the company's share ledger.

Special form of registered share. In accordance with Article 68 Paragraph 2 of the German Stock Corporation Act, the transfer of registered transferable shares outside the normal conditions for the transfer of registered shares also requires the consent of the Aktiengesellschaft.

The ratio of the annual surplus to the balance sheet equity used. Return on equity is a balance sheet ratio, which provides information on the company's earning situation, comparable to interest on a financial investment.

Index which shows the development of German fixed-income bonds. Fixed-income bonds are fixed-interest securities e.g. government bonds, Pfandbriefs, or corporate bonds.

Standard & Poors is one of the most comprehensive American indices, which lists and calculates the top 100 or 500 individually weighted market prices.

Corresponds to the term "rationing". Only takes place if there are more buyers for a security than planned in the issue. The securities are then scaled down, i.e. rationed out. Scaling down or rationing can also take place on the stock market if the number of buyers or sellers is greater than the shares offered or in demand. ratG (scaling down of buy orders) or ratB (scaling down of sell orders) is then added to the quotation.

U.S. Securities und Exchange Commission. The American trading authority, which is informed of all stock exchange transactions, approves admission applications, monitors stock exchanges, requests information and safeguards the efficiency of the stock markets, thereby protecting the investor. Created in 1934 after the stock exchange crash of 1929 and as an authority to monitor the new legislation for shares (1933) and stock exchanges (1934) prescribed by the American Congress. Franklin Delano Roosevelt appointed Joseph P. Kennedy (father of John F. Kennedy) as the first head of the authority.

An index which lists shares according to individual sectors. Alongside the international MSCI indices, the most well-known sector indices are the C-DAX, the Dow Jones Utilities Index and the Dow Jones Transportation Index. The Baader Bank AG generally compares with the CDAX Financial Services.

Certificates which document a private right in such a way that the possession of the certificate is required as a minimum to exercise this right. Securities are e.g. bank notes, cheques, bills of exchanges, shares, bonds, mortgage certificates etc. The transfer of the rights requires the presentation or transfer of title of the security. In the narrower sense of the word, securities refer to fungible securities: these include bonds, shares, investment certificates etc.

Settling stock exchange transactions by providing money or certificates.

A security which documents an investment in an Aktiengesellschaft. The share in the share capital and thus in the total balance sheet assets of the AG is determined by the par value. For no-par value shares, the share in the share capital is a fraction corresponding to the number of outstanding shares. The market price of the share corresponds to the daily stock exchange trading price. The Baader share is a no-par value share. The stake in the share capital is EUR 1.00 per share. The share offers the holder two sources of earnings: the dividend from the shareholder's investment in the profits of the AG and the opportunity to increase assets with a rise in the market value.

The assessment of the earnings power of a company or the price prospects of the relevant shares according to various criteria is known as share analysis. The share is assessed using various weighted figures. Economic trends, orders, price stability etc are all important for fundamentalists. Monetarists are interested in the money supply, inflation and interest rates (real interest rates, yield curve, interest rate differences etc). Using price developments and data relating to sales amounts technical analysts try to identify typical formations that could be interpreted as incentives to buy/sell. Psychologists examine the development of the business climate, consumer behaviour and the sentiment particularly among non-professional and professional stock exchange operators. A mixture of all the individual components is important for a good analysis of the price potential of a share.

A share index is an index that shows the price development of the stock market or individual sectors. Important share indices in Germany are the DAX, which is continually updated during trading times, the Börsenzeitung or the FAZ (Frankfurter Allgemeine Zeitung) index. The Dow Jones Index and the Standard&Poors 500 Index are of particular interest for the US, as is the Nikkei-Index for Japan.

see: Option

The price of shares traded on the stock exchange. As a market price, the price is the result of the relationship between supply and demand at the time of the price determination. Important influencing factors in this are the economic expectations placed on a listed company, the economic conditions (particularly interest rate s), political expectations, speculation and prospective purchases.

Electronic register of holders of registered shares. The account holding banks register additions or withdrawals electronically and have the sole responsibility for ensuring that the portfolios are correct. There are two options for registration in the share register: a) the shareholder himself/herself is listed by name, their address and the number of shares or b) the shareholder registers his/her account holding bank and is not listed personally in the share register. Registration of a portfolio in the share register by a certain date is crucial in order to exercise voting right s at the Annual General Meeting.

A share split is the division of a share into two or more parts. It primarily serves to lower visibly the value of the relevant shares, thereby improving their tradability. The stake in the company held by the individual shareholder remains unchanged before and after the share split. The company's assets are simply divided between more shares than previously.

According to the transfer criteria, bearer shares, registered shares and registered transferable shares can be transferred by simply obtaining mutual consent and by transfer of title. The holder presenting the certificate has all shareholders' rights. Baader Bank AG offers its shareholders only bearer shares. For registered shares, the holder is named on the share certificate. According to the criterion of voting rights, shares are differentiated between ordinary and preferred shares: ordinary shares grant full voting rights at the Annual General Meeting. Preferred shares are usually exempt from voting rights; instead, the preferred shareholder receives a higher dividend or a guaranteed dividend and other privileges, for example, privileges in the event of the liquidation of the AG. Shares in the Baader Bank AG are only available as ordinary shares.

A percentage breakdown of shareholders according to specific criteria such as holder type (major shareholders, institutional investors, individual investors).

Shareholder value is a management philosophy which aims to increase the share value in the long-term. The company management works on the assumption that the providers of capital, the shareholders, are entitled to an increase in value.

Swiss Market Index. Share index in Switzerland, consisting of 27 weighted shares.

See Market Maker

-> Share split

The German term for stock exchange, "Börse", is derived from a businessman named "van der Beurse", who was involved in the international exchange of goods in the 13th Century. The stock exchange is the market (where supply and demand meet) for securities, currencies and certain goods, on which brokers (official ledger brokers) determine prices for the buy and sell orders that they receive during stock exchange trading hours. In addition to Frankfurt, securities are traded at six other regional stock exchanges in Germany: Berlin-Bremen, Dusseldorf, Hamburg, Hanover, Munich, and Stuttgart. Important international stock exchange are the New York Stock Exchange ("Wall Street"), London and Tokyo.

Supply and demand for shares meet on the stock market. Shares are primarily traded on the stock exchange, where trade is distinguished into the amtlicher Handel (Official Market), the geregelter Markt (Regulated Market) and Freiverkehr (Open Market) according to the stringency of the trading regulations. However, shares are also traded outside the stock exchange, for example by telephone.

-> Market capitalisation

also: Listing. First listing of the securities of a company on a stock exchange. The company must fulfil specific requirements with regard to accounting, capital resources and publicity in order to be admitted to the stock exchange. In addition to the publication duties of non-listed Aktiengesellschaften, those listed on the stock exchange must publish information which could affect prices (see -> Ad-hoc publicity).

STOXX and EUROSTOXX are registered trademarks of Dow Jones. The US company uses them to calculate various indices, in which the 50 largest European companies are combined (STOXX), to give a general overview of the European market. EUROSTOXX lists the 50 largest companies in the euro zone.

As a purchaser of a call or put option has the right to buy or sell underlying instruments after exercising an option, both the option price and the strike price at which the relevant securities are to be settled in the event that an option is exercised must be agreed when the transaction is closed.

Period in which securities can be purchased at the issue conditions on the primary market.

A shareholder's pre-emptive right to purchase shares issued during a capital increase. The calculated value of the subscription right and the price at which it is traded may vary, as the price is based on supply and demand.

The Supervisory Board appoints, monitors and advises the company management (Board of Directors). In companies with co-determination, its members are selected partly by the Annual General Meeting and partly by employees.

Swiss Exchange, the Swiss Stock Exchange in Zürich.

A securities dealer who carries out his/her own stock exchange transactions (in contrast to a -> broker).

Fluctuation range of prices. With sharp price fluctuations, a -> share has high volatility. This means an opportunity for the investor to make high profits quickly, but also poses the risk of losses occurring just as quickly.

The right of the -> shareholder to participate in resolutions at the Annual General Meeting (usually one vote per -> share). Each shareholder may transfer his/her voting right by proxy to his/her account-holding bank or another participant of the AGM.

Shares, bonds, investment certificates and warrants listed in Germany are identified by a six-digit Wertpapierkennummer, WKN, (securities identification number).

Electronic trading system of Deutsche Börse AG, which was created based on the previous IBIS system in 1997.

Yield measures the interest on the capital used in %. It is distinguished between a) dividend yield = ratio between the dividend + tax credit and the purchase price of the share, b) return on investment =  dividend + tax credit + price changes + subscription rights on the purchase price of the share.