Stock Market Terms By Letter: F

F

Face Value: Or Par Value, the nominal value of each share.
FIC: See Foreign Investment Committee (of Malaysia).

FIFO: Stands for First-In-First-Out. It is an accounting method for the valuation of stocks. It treats the first item of stocks purchased as the first item of stocks used. The opposite is LIFO. During periods of high inflation, FIFO tends to overstate the profitability of the firm.

Final Dividend: The dividend which is paid at the end of a Financial year (as opposed to an Interim Dividend which is paid after part of the financial year is over).

Finance: Money which is raised to fund a project. It can be in the form of debt or equity finance.

Financial Analysis: Analysis (mainly quantitative) carried out on the financial figures of’ s company in order to uncover its strengths and weaknesses.

Financial (or Fiscal) Year (FY): Usually a 12-month period which is used as the basis for the preparation of the financial reports of the companies.

Fixed Costs: Costs which do not vary with the level of output of a firm. Fixed Deposits: Deposits in a financial institution for a fixed period at fixed interest rates.

Fixed-Income Securities: Refers to securities where the return on investment when the security is held to maturity is fixed, i.e. Loan Stocks.

Fixed Assets: Assets which are held for the long term, e.g. land. building and plant. Together with Working Capital, they constitute the two main types of assets owned by a firm.

Flag: A charting information which appears as s small, compact parallelogram of price fluctuations which slopes back moderately against the prevailing trend.

Float: The ‘introduction’ of s new public company to a stock exchange to raise funds from the public. (Flotation raising of capital by public subscription through a. prospectus).
Foreign Investment Committee (of Malaysia): Originally set up to be the overseeing authority in relation to share transfer to foreign residents. At present, it is the authority in charge of overseeing large transfer of shares.

Forward Contract: A contractual agreement to buy or sell an asset (e.g. shares) at sometime in the future.

Fully-Paid Shares: Refers to shares on which there is no more uncalled capital.

Fundamental Approach: An investment approach which relies on careful analysis of the earnings and dividend prospect of a company. From this analysis, fundamentalists believe they can compute the Intrinsic or Real Value of a share.