Bulletin board

A website where investors post gossip, fact and opinion about stocks and markets. Bulletin boards are immensely popular, but - given their virtual anonymity and their lack of regulation -they can be traps for unwary investors.

Bulletin board

A website where investors post gossip, fact and opinion about stocks and markets. Bulletin boards are immensely popular, but - given their virtual anonymity and their lack of regulation -they can be traps for unwary investors.

Bull

An optimist; someone who assumes that prices will rise. The origin is unknown, although it probably evolved because it contrasts strongly with bear. As the quote from Alexander Pope shows, it was in common usage in London by the early 18th century.

Come fill the South Sea goblet full;
The Gods shall of our stock take care:
Europa pleased accepts the bull,
And Jove with joy puts off the bear.
Alexander Pope, inscription on a punch bowl, 1720
(the year of the South Sea Bubble)

Warren Buffett

Arguably the best-known investor on the planet. Buffett is known for the world-class returns he has produced for over 30 years from his investment conglomerate, Berkshire Hathaway, and for his witty and insightful chairman's letter in Berkshire's annual report. Adding in the investment record of Buffett's partnership, which he ran from 1956 to 1968 before sinking his capital into Berkshire, then his record from 1956 to 2001 showed an annual compound growth rate of 24.5%, enough to turn $1,000 into $i9m. Over the same period, the pre-tax return from the S&P 500 index was 10.1% a year.

Buffett is characterised as an exponent of value investing and he learned his trade from Benjamin Graham, who first espoused that particular cause. In many respects, however, Buffett's investment style is far removed from Graham's. It focuses on the "business franchise", the idea that there is a small cadre of exceptional businesses whose advantages mean that they are protected from everyday economics. Brand-name corporations, or those which can grow on the back of bigger corporations - "gross royalty businesses" such as advertising agencies - are good examples.

Brady bond

Named after Nicholas Brady, an American Treasury secretary, who in 1989 came up with the Brady Plan to ease the debt burden that was crushing too many developing-country economies. Brady bonds are issued by indebted governments as part of a refinancing of their bank debt following the introduction of an agreed schedule between them and their creditors. This would be likely to include the adoption of responsible monetary policies by the governments concerned and some debt write-off by their bank lenders. Even so, Brady bonds, which are traded on over-the counter markets, are high-risk investments.

Book value

That part of a company's assets which belongs to its shareholders; in the UK these are generally known as shareholders' funds or, simply, net assets. It is an accounting valuation arrived at by taking the gross assets of the business as shown in its balance sheet and subtracting all the prior claims on the business, such as bank debt, payables, allowances for future claims, and so on. Alternatively, it is the sum of the shares outstanding, additional paid-in capital and retained earnings. Book value is usually expressed in per share terms so as to make an easy comparison with the market price of the shares (see Price to book ratio).

Bottom fishing

What value-seeking investors do after a stock market has fallen heavily, exposing good value in shares which fair-weather investors are still too shell-shocked to take.