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All A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Indian Market, Regulation & Taxation

Depository

An institution that holds securities in electronic form and enables their transfer between accounts.

Test: the entity is registered with SEBI as a depository and maintains securities in dematerialised form for beneficial owners qualitative
Market Basics & Instruments

Depository Receipt

A negotiable instrument issued in one country that represents shares of a company listed in another.

Underlying Shares Represented = Number of Receipts x Receipt Ratio shares
Financial Statements & Accounting

Depreciation

The systematic allocation of a tangible asset's cost over its useful life as an expense in each period.

Straight-Line Depreciation = (Cost - Residual Value) / Useful Life in Years ₹ crore
Derivatives, Futures & Options

Derivative

A contract whose value is determined by the price of another asset, called the underlying.

Test: the contract's payoff is defined by reference to the price of a separate asset, rate or index qualitative
Technical Analysis & Chart Patterns

Descending Triangle

A formation with a flat lower boundary and a falling upper boundary, so the range narrows downward toward a point.

Test: two or more lows at approximately the same level, with successively lower highs converging on them qualitative
Fundamental Analysis & Valuation

Diluted Earnings per Share

Earnings per share recalculated as if every instrument convertible into equity had already been converted.

Diluted EPS = Adjusted Profit / (Weighted Average Shares + Shares from Conversion of Dilutive Instruments)
Fundamental Analysis & Valuation

Dilution

The reduction in existing shareholders' proportional ownership and per-share claims caused by issuing new shares.

New Ownership % = Old Shares Held / (Old Shares Outstanding + New Shares Issued) x 100 %
Orders, Execution & Market Structure

Direct Market Access

An arrangement in which a client's orders reach the exchange through a broker's infrastructure without manual intervention by the broker.

Test: orders pass automated risk checks and route to the exchange without a dealer keying them in qualitative
Funds, ETFs & Index Investing

Direct Plan

A version of a mutual fund scheme bought without a distributor, carrying no commission and therefore a lower expense ratio.

Test: the investment is made directly with the fund house or through an execution-only platform, with no distributor commission embedded %
Indicators & Oscillators

Directional Movement Index

A pair of lines measuring upward and downward directional movement separately, from which the ADX is derived.

+DM = Current High - Previous High when positive and larger than -DM; -DM = Previous Low - Current Low when positive and larger than +DM; each is smoothed and divided by ATR to give +DI and -DI ratio (x, times)
Bonds & Fixed Income

Dirty Price

The total amount a buyer pays for a bond, including accrued interest since the last coupon.

Dirty Price = Clean Price + Accrued Interest
Orders, Execution & Market Structure

Disclosed Quantity

The portion of an order's total size that is made visible in the public order book.

Test: disclosed quantity is less than total quantity and meets the exchange's minimum disclosure percentage shares
Bonds & Fixed Income

Discount Bond

A bond trading below its face value, because its coupon is lower than the yield the market currently requires.

Test: Market Price < Face Value, which implies Yield to Maturity > Coupon Rate
Fundamental Analysis & Valuation

Discounted Cash Flow

A valuation method that estimates a business's worth as the present value of the cash it is expected to generate.

Value = Sum of (Cash Flow in Year t / (1 + Discount Rate) raised to t) + Present Value of Terminal Value ₹ crore
Economy, Macro & Market Cycles

Disinflation

A slowing in the rate of inflation, while prices continue to rise.

Test: the inflation rate falls between periods while remaining above zero %
Market Psychology & Behavioural Finance

Disposition Effect

The tendency to sell winning positions too early and hold losing positions too long.

Test: the proportion of gains realised exceeds the proportion of losses realised, across a portfolio over time qualitative
Indicators & Oscillators

Divergence

A condition in which price and an indicator derived from it move in opposite directions.

Test: price makes a new extreme while the indicator fails to confirm it with a corresponding new extreme qualitative
Risk & Portfolio Management

Diversification

Spreading investments across assets whose returns do not move together, so that the portfolio's volatility falls below the average of its…

Portfolio Variance = Sum over all pairs of (Weight i x Weight j x Covariance of i and j) qualitative
Corporate Actions, Dividends & Governance

Dividend

A distribution of a company's profits to its shareholders, paid in cash out of distributable reserves.

Total Dividend Paid = Dividend per Share x Number of Shares Outstanding
Fundamental Analysis & Valuation

Dividend Discount Model

A valuation method that values a share as the present value of all the dividends it is expected to pay.

Value = Sum of (Expected Dividend in Year t / (1 + Required Return) raised to t)
Corporate Actions, Dividends & Governance

Dividend Payout Ratio

The proportion of a company's earnings distributed to shareholders as dividends.

Dividend Payout Ratio = Dividend per Share / Earnings per Share x 100 %
Corporate Actions, Dividends & Governance

Dividend per Share

The total dividend declared for a period divided by the number of shares outstanding.

Dividend per Share = Total Dividend Declared / Number of Shares Outstanding
Market Basics & Instruments

Dividend Stock

A share of a company that distributes a substantial and reasonably reliable portion of its profits as dividends.

Test: a sustained payout ratio and dividend yield materially above the market average, supported by free cash flow qualitative
Indian Market, Regulation & Taxation

Dividend Taxation

The taxation of dividends in the hands of the shareholder at their applicable slab rate, following the 2020 change.

Tax on Dividend = Dividend Received x Marginal Slab Rate, with TDS deducted by the company above a threshold