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BID WHACKER
Although it sounds like a superhero’s name, a bid whacker is someone you do not want to invite to the market! Bid whacker refers to the investor who sells below or at the bid price. This act temporarily drives down the market prices of a security. As sellers normally negotiate for a price between the bid and ask quotes, the unconventional bid whackers usually upset other sellers.
TRIPLE WITCHING
Triple witching or Freaky Friday occurs on the third Friday of December, March, June, and September. At this time, the stock market index options and futures expire in one day. This leads to great volumes of trading as investors try to offset their options and futures before the time is up.
BLUE CHIP COMPANIES
You often hear financial gurus advising you to invest on the blue chips, but what do they really pertain to?
Blue chip companies are large companies that are considered to be well-renowned, highly established, and more financially sound. If you want to invest your money in stocks that have proven their strength and profitability through economic downturns then you should consider these companies. International blue chip companies include H.J. Heinz (HNZ) and Disney (DIS) while local blue chip companies include Singapore Press Holdings (SGX: T39) and Singapore Telecommunications (SGX: Z74).
ANKLE BITER
An ankle biter refers to a stock that has low market capitalization. These are also known as small-cap stocks and encompasses many emerging technologies. Ankle biters as an investment tend to be more fickle and typically thinly traded. However, the growth potential in these stocks are higher than the large-cap stocks.
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STALKING-HORSE BID
Stalking-horse bid is an initial bid on a bankrupt company’s assets. It usually comes from a serious buyer selected by the bankrupt company itself in order to prevent low-ball offers and enforce an engaging bidding war. Once the stalking-horse bid is received, the bankrupt company will open its doors to other interested companies that are willing to offer their own bids.
With this strategy, the bankrupt company is able to attain the best possible price.
