Investment Terms You Want to Know

Here’s something most of you might not have heard of, a collection of investment-related buzzwords that pay homage to what VenusBuzz is all about. The next time someone asks you if you know anything about investment, you can amaze them with your newly acquired vocabulary.

Taken from Investopedia.com

Jennifer Lopez – J.Lo

A slang technical analysis term referring to a rounding bottom in a stock’s price pattern. This term got its name from Jennifer Lopez’s curvy figure; she is often criticized (or praised) for her round bottom.

Investopedia explains

Traders like the rounding bottom in a stock pattern because it can be an indication of a positive market reversal, meaning expectations are gradually shifting from bearish to bullish.

Paris Hilton Stock Index

A stock index comprised of companies associated with the socialite Paris Hilton. Some investors conceive her influence on the consumer spending habits of her fans is material enough to give these companies a competitive advantage.

Investopedia explains

The concept behind the Paris Hilton Index resides in her endorsements and product lines. Ideally, Hilton’s fans see her using certain products or releasing her own brands and flock to purchase the goods. As a result, the companies behind the products experience increased sales. Companies included in this index are Parlux Fragrances (who manufacture Hilton’s brand of perfumes), News Corp, Time Warner and Amazon.

Angelina Jolie Stock Index

An index made up of a selection of stocks from companies associated with actress Angela Jolie. Seen as one of the world’s most influential celebrities, some analysts believe that companies connected with Jolie will outperform their competition.

Investopedia explains

The index was created by Fred Fuld of Stockerblog.com; it includes the stocks of movie studios and producers that have had a connection with Angelina Jolie, such as Sony (NYSE:SNE), Viacom (NYSE:VIA) and Time Warner (NYSE:TWX). Because Jolie’s films usually earn large box-office revenues, the companies that produce these movies should have higher profits.

Bo Derek

A slang term used to describe a perfect stock or investment. In the 1979 hit movie “10″, actress Bo Derek portrayed the “perfect woman”, or “the perfect 10″.

Investopedia explains

This term was used more often in the early 1980s, after the movie “10″ first came out. Nowadays, the name of a more current celebrity, like Jennifer Lopez, might be used in finance jargon.

Eva Longoria Stock Index

A stock index comprised of companies related to the actress Eva Longoria. Some analysts believe that Eva Longoria has enough influence over consumers that her endorsements will materially affect product sales.

Investopedia explains

On the popular television show “Desperate Housewives”, Longoria often promotes consumer goods. Outside of acting, she has endorsement deals with companies such as Hanes, Bebe and L’Oreal. These companies are included in the Eva Longoria Stock Index, under the premise that her fans will increase the revenues of the promoted products.

Lipstick Indicator

An indicator based on the theory that a consumer turns to less expensive indulgences, such as lipstick, when she (or he) feels less than confident about the future. Therefore, lipstick sales tend to increase during times of economic uncertainty or a recession.

Also known as the “lipstick effect”.

Investopedia explains

This term was coined by Leonard Lauder (chairman of Estee Lauder), who consistently found that during tough economic times, his lipstick sales went up. Believe it or not, the indicator has been quite a reliable signal of consumer attitudes over the years. For example, in the months following the September 11 terrorist attacks, lipstick sales doubled.

Skirt Length Theory

The idea that skirt lengths are a predictor of the stock market direction. According to the theory, if skirts are short, it means the markets are going up. And if skirt are long, it means the markets are heading down.

Investopedia explains

The idea behind this theory is that shorter skirts tend to appear in times when general consumer confidence and excitement is high, meaning the markets are bullish. In contrast, the theory says long skirts are worn more in times of fear and general gloom, indicating that things are bearish.

Although some investors may secretly believe in such a theory, serious analysts and investors – instead of examining skirt length to make investment decisions – insist on focusing on market fundamentals and data.

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