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Banktionary
Complicated financial jargon? At MeDirect, we make it easier. From investing and saving to paying, find out everything you need to know here!
Invest glossary
Equities, also known as shares, are financial assets that represent a part of a company’s capital. When you buy shares, you become a shareholder, granting you joint ownership of a company. Shares also grant you the right to receive dividends paid out by the company. If the company goes bankrupt, there is a high risk to lose your invested capital.
When buying a bond, you lend money to a company or to public authorities for a defined period. In exchange for your money, the company or the public authorities pays you interest. Upon maturity, the money you lent is repaid. If the company goes bankrupt, there is a chance to lose your invested capital.
An ETF, also known as tracker fund, is an investment instrument whose objective is to reproduce the performance of a market index, a basket of equities, bonds, currencies or a commodity, for example. Tracker funds give you access, via a single transaction, to an extensive portfolio, allowing for risk-spreading.
Most funds are UCIs: “Undertakings for Collective Investment”. Each UCI may be considered as a company whose objective is to pool the savings of multiple investors in a large pot, which the fund invests. The most common UCIs are what are known as SICAVs: investment companies with variable capital. The total amount available to these funds for investment varies. The more people invest in the fund, the more money the fund has to invest, and vice versa. Investments made by funds are carried out by fund managers based on previously defined strategy and conditions.”
Payment glossary
A current account allows you to carry out your daily financial transactions, such as receiving your income or making payments, transfers, or withdrawals. It also allows you to manage the income from selling investments and receiving dividends and interest on your investments. Upon becoming a client at MeDirect, a current account in euros is opened by default.
Mastercard debit is a type of debit card linked to your bank account. With a Mastercard debit card, you can make purchases online, in stores, and withdraw cash from ATMs. It functions like a regular debit card but bears the Mastercard logo, which means it can be used wherever Mastercard is accepted worldwide (whenever the Mastercard logo is displayed at a point-of-sale terminals). To order one, simply access the MeDirect app or the MeDirect online banking platform and go to the “Cards” tab.
At MeDirect, clients can use a virtual Mastercard debit card, which is only available for online payments. Unlike physical cards, they cannot be used in person at point-of-sale (POS) terminals and for cash withdrawals at ATMs. To order one, simply access the MeDirect app or the MeDirect online banking platform and go to the “Cards” tab.
A standing order refers to an arrangement made by a bank account holder to pay a fixed amount at regular intervals to another account or to a specific recipient.
Order glossary
A standing order refers to an arrangement made by a bank account holder to pay a fixed amount at regular intervals to another account or to a specific recipient.
A limit order can be used to control the price at which you buy or sell a security. It allows you to set a minimum sale price (a “sell order with a limit”) and/or a maximum buy price (a “buy order with a limit”).
A buy order with a limit is an order placed by an investor that could only be executed when the security price reaches the set limit or goes below that limit. If the limit price is reached, your order might be executed, but it will never be executed above the limit you have set. In other words, you cannot buy at a higher price than the limit you have set. In exceptional circumstances at market opening, if the securities market price would suddenly drop, your buy order could even be executed below your set limit.
A sell order with a limit describes an order placed by an investor that could only be executed if the security price reaches the set limit or if it exceeds that limit. If the limit price is reached, your order could be executed, but never under the limit you have set. In other words, you cannot sell at a price lower than the limit you have set. In exceptional circumstances at market opening, if the securities market price would suddenly increase, your sell order could even be executed above your set limit.
A market order can be used when your priority is not the price at which an order is executed, but mainly the chance of execution. By placing a market order, your order will be executed at the current market price (“ask price” if buying and “bid price” if selling). In most instances, your order could be executed immediately, under the condition that the market is open, and that the available volume is sufficient to fill your order. Please note that in some cases, the current market price may significantly deviate from the last known price (for example, if trading volumes are low or if bid/ask spread is important). Consequently, the price at which your order will be executed may also deviate significantly from the last known price. Execution of a market order is never guaranteed.
A day order is a limitation on the time of a given order. This means that it will only remain active during the trading day on which it was placed. If the order is not executed, it will be cancelled automatically after the market closes. Market orders can only be set as day orders.
A ‘Good until Cancelled’ order describes an order placed by an investor to buy or sell a security. It remains active until it is either executed or manually cancelled, whichever happens first. In theory, this is an order type with no expiration date. However, in reality, this is not always the case. Limit orders with GTC validity will automatically be cancelled after six months to protect the investors from long-forgotten orders being executed. Please note that there are different possible scenarios in which your order might be cancelled. These may include corporate actions that take place, ex-dividend date of a coupon, a specific request from the stock exchange to cancel, and so on. This list is not exhaustive.
A ‘Good until Date’ order describes an order that will remain active until a specified, preset date, such as the end of the week or the end of the month. Once the specified date has passed, the order will be cancelled automatically if it has not been executed. If the order has been partially executed, the remainder of the pending order will be cancelled automatically once the specified date has passed. Please note that there are different possible scenarios in which your order might be cancelled. These may include corporate actions that take place, ex-dividend date of a coupon, a specific request from the stock exchange to cancel, and so on. This list is not exhaustive.