Trading Terms Starting With V

  • VIX®

    see CBOE Volatility Index®.
  • VXO

    see CBOE S&P 100 Volatility IndexSM.
  • Value fund

    a mutual fund that follows a strategy of value investing rather than growth investing. The emphasis is on perceived safety, with a focus on buying well established stocks the fund deems undervalued with respect to fundamentals, and profiting from their return to fair value. The fund also looks for well established companies with solid earnings passed along to shareholders as dividends, and the potential for long-term appreciation in share value. Comparatively speaking, a value fund aims to produce more consistent, conservative and less volatile returns than a growth fund. See also Value investing.
  • Value investing

    a strategy in which an investor focuses on stocks that are perceived to be undervalued with respect to certain fundamental measures: low price/earnings (P/E) ratios, low price to book value ratios, high level of asset backing, and/or high dividend yields. The value investor commonly concentrates the search for stocks that meet these criteria in a pool of well established, conservative companies whose growth has slowed or stopped. These stocks may no longer be popular with mainstream investors for other reasons: a poor earnings report, a period of financial difficulty in their industry sectors, and/or investor sentiment that these stocks have fallen out of favor. For whichever reasons the selected stocks are perceived as undervalued, the value investor will purchase them if they show a good potential for a return to fair value as well as for steady, long-term growth and capital appreciation.
  • Variable annuity

    a contract generally purchased from an insurance company that provides its owner a stream of periodic income payments, usually after retirement. The payment amounts may vary, or fluctuate, because they are based on the performance of an underlying investment portfolio of securities. Typically these security investments are in the form of common stock which can produce much higher returns, but also come with a greater degree of market risk than a portfolio of fixed income securities underlying a fixed annuity. See also Fixed annuity.
  • Vega

    one of the Greeks derived from a pricing model, it is the amount an option's theoretical value will change for a corresponding one-unit (one percentage-point) change in the contract's implied volatility.
  • Venture capital (VC)

    investment capital from high net worth independent investors, institutional investors, banks and/or partnerships that is pooled together and managed by a dedicated financial firm. The funds are made available to startup companies and existing small businesses that frequently have developed or possess new technologies and are considered to have outstanding and rapid growth potential, but are either too small and/or without the capital to secure a bank loan. In return for the capital they have at risk, the investors might become involved in the company's management as well as take an equity position and/or share of profits.
  • Vertical spread

    an option strategy established by buying one option and selling (writing) another with the same underlying and expiration month, but with a different strike price. The two options must be either both calls or both puts. Some examples include long call spread, short call spread, long put spread, short put spread.
  • Visible supply

    the total par value of all municipal bonds with maturities of 13 months or more scheduled to be issued in the open market over the next 30 days.
  • Volatility

    fluctuation, or changes up or down, in the price of a stock or level of an index. It is measured as the annualized standard deviation of daily changes, and expressed in percentage form. Higher volatility represents greater fluctuation; lower volatility represents less fluctuation.
  • Volatility index

    see CBOE Volatility Index®.
  • Volume

    for a given security, an exchange or the entire market, the number of shares, bonds or contracts traded in a given timeframe, typically one day. Also termed Trading volume.
  • Volume weighted average price (VWAP)

    an intraday technical indicator that represents the average price paid per share of stock during a given timeframe (up to an entire trading day). Calculated by adding up the total dollar value of every transaction within the timeframe (price multiplied by shares traded) then dividing by the total shares traded during the same period.
  • Voting right

    investors who own shares of common stock in a company have voting rights which allow them to participate in the election of corporate directors or decide on certain propositions put forward by the company's management or other stockholders such as: substantial changes in the company's operations, stock splits, new securities issues, and/or initiating any other action that affects shareholder assets. Voting rights are apportioned on a per share basis, not a per investor basis, with each share of common stock carrying one vote. Owners of corporate bonds or preferred stock typically do not have voting rights.