How many times have you watch the financial segment on your local news stations when the report covers the stock market? What about when you’re browsing the internet and you run into a site that has information on the stock market. Do you really know what you’re reading? If you’re like the thousands of people who don’t know the first thing about the stock market or its terminology your not alone.

Financial terminology can be quite confusing if you’re a novice to the stock market. But having an understanding of financial terminology is critical if you’re planning on making a few investments. While it is advised before you begin investing in stock and using the stock market you should seek professional training or use a stock broker. But even when you use a stock broker you want to have a profound understanding of investment lingo.

It’s not necessary to learn the entire dictionary of financial terminology but having a deep understanding of the most common terms and phrases used would be an important step for someone who wants to invest. Especially with the high risk that comes with investing on the stock market knowing what those symbols, arrows and other terms used means will help you to make wise choices when buying and/or selling stock. Here are 7 of the most common terms used on the stock market.

Book Value refers to the current asset value of a company balance sheet after accounting conversions. Typically the shareholders equity on the companies’ balance sheet reflects the value of the company.

Capitol Appreciation means the underlying value of one or two security components that has increased. In other words if you invested $10 in stock and it rose by $3 you have accumulated 30% on your investment return.

EPS or Earnings per share when used on the stock market references to the amount of money, income or net worth after the investment company has paid all outstanding bills and what is left over.

P/E or Price per Earnings Ratio is the value of your shares as it relates to the price of stock currently on the market. In other words your earnings per shares are meaningless without factoring in the P/E.

Revenues are the amount made through sales over a period of time on the market you will hear this term used frequently on the stock market For example a company’s annual revenues refer to the amount made through sales over the course of a year, whereas quarterly revenues refer to earnings from sales made over the course of three months.

Volume refers to the amount or total number of shares a company has traded on the stock market during the daily exchange. This amount can be determined by dividing the total number of shares traded annually by the new of days in the year.

Utilities is a term used to describe any company on the stock market that provides essential services to the general public, this includes gas, electric, water and government regulated companies or companies that holds a monopoly in their specific industry.