Bear Trap

Trading Basics

Bear Trap

When a piece of analysis points to the market falling and the price instead goes up, trapping the bears.

Other Trading Basics

Backwardation

Backwardation occurs when a bid price exceeds the ask price.

This usually occurs when stock is suspended or under a share repurchase scheme.

It can also mean that a futures contract will trade at a higher price when it is coming close to expiring.

The opposite of backwardation is known as contango.

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Book Building

When a new share is issued book building is the process institutions go through to gauge demand and therefore price.

This goes on before the share is available to trade on the exchange.

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Assets

Anything that is owned that is expected to generate a return to the owned.

Opposite to a liability.

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