0-9
- “Line Chart “
- The simplest form of charting, a line chart plots a series of lines connecting the various price levels over a specified time period.
A
- ADI
- Abbreviation for Average Directional Index. It is a technical indicator that is used to gauge the strength or weakness of a trend in the financial markets.
- AUD/USD
- The abbreviation for the Australian dollar and U.S. dollar (AUD/USD) currency pair or cross.
- Account (FP Account, or Account Number)
- Account with FP Markets established under the Account Terms, including all Trading Accounts and all Transactions recorded in them.
- Account Balance
- The account balance reflects the amount of money on your account excluding the profit/losses from your current open positions.
- Account Equity
- The equity reflects your balance + your floating profit /loss of your open positions.
- Adjustable Peg
- Exchange rate regimen where a currency’s conversion rate is ‘pegged’ (fixed) in relation to a stronger currency (such as the US dollar or Euro). The pegged rate is adjusted occasionally in an attempt to improve the country’s competitive position.
- Aggregate Risk
- When a bank or financial body is exposed to forex contracts from a single customer for in spot and forward foreign exchange contracts.
- Agio
- Agio is a description of a bond premium – for example, when a bond’s market value is greater than its par value; also sometimes refer to the fee charged to exchange money from one currency to another.
- Altcoin
- Altcoins are the alternative cryptocurrencies launched after the success of Bitcoin. Generally, they project themselves as better substitutes to Bitcoin. At the time, cryptocurrencies other than bitcoin were referred to as altcoins (or alternative coins). The term has stuck among cryptocurrency traders and is still used to refer to lower cap cryptocurrencies.
- Anonymous Trading
- Bids and offers that are present on the financial markets without disclosing the identity of the market participants. Many stock exchanges, such as the London Stock Exchange, Toronto Stock Exchange, and NASDAQ, as well as dark pools offer anonymous trading.
- Appreciation
- Appreciation, in general terms, is an increase in the value of an asset over time.The increase can occur for a number of reasons, including increased demand or weakening supply, or as a result of changes in inflation or interest rates. A currency is said to ‘appreciate’ when it strengthens in price in response to market demand.
- Arbitrage
- The simultaneous buying and selling of a financial instrument in different markets to take advantage of different pricing.
- Ask
- The lowest seller in the market at that time. Also known as offer.
- Ask Rate
- Also referred to as offer. The rate at which a financial instrument is offered for sale (as in bid/ask spread).
- Asset
- The underlying instrument essential for determining a contract. An item/resource of value. It can be a precious metal, stock, currency pair, or bond.
- Asset Allocation
- A strategy that refers to portfolio diversification over various asset classes with the intention of maximizing returns and also minimizing risks.
- At Best
- An instruction given to a dealer to buy or sell at the most desirable price available, and as quickly as possible.
- At or Better
- An order to deal at a specific rate or better. They are an example of a limit order, which sets a specific price to be met for a trade to be made.
- At the Money
- Is a term used to describe an options contract with a strike price that is identical to the underlying market price. Both call and put options can be simultaneously ATM.
- Attorney in charge
- An individual who is authorized to trade in the financial markets on behalf of a trader.
- Aussie
- Australian Dollar
- Authorized Forex Dealer
- A financial entity that has received authorization from a relevant regulatory body to act as a dealer involved with the trading of foreign currencies. Dealing with authorized forex dealers ensures that your transactions are being executed in a legal and just way.
- Automated Forex Trading
- Automated forex trading is a system of trading foreign currencies with a computer program based on a set of analyses that help determine whether to buy or sell a currency pair at a given time.
- Away from the Market
- Is an expression that is used in two different scenarios when a buy or sell price deviates from a specific related benchmark. A situation in which the bid on a limit order is lower than the present market price or the offer price is more than the present market price for a financial instrument.
B
- Back Office
- The departments and processes related to the settlement of financial transactions (process and report transactions).
- Balance of Trade
- The difference in value between a country’s exports and imports.
- Balance-of-Payments
- System of recording a country’s economic transactions. A statement of all transactions made between entities in one country and the rest of the world over a defined period of time, such as a quarter or a year.
- Band
- In countries where the currency is pegged, the range in which the rates are permitted to fluctuate.In finance, a trading band is a range of prices for a commodity or currency.
- Bank Notes
- Paper issued by a Central Bank, redeemable as money and considered to be legal tender. A banknote is payable to the bearer on demand, and the amount payable is apparent on the face of the note.
- Bank Rate
- The rate at which a central bank is prepared to lend money to its domestic banking system, often in the form of very short-term loans.
- Banking Day
- Days of the week when commercial banks are open for business in the country of the particular currency traded. Usually banking day is all day except Saturday, Sunday and legally defined holidays.
- Bar Chart
- A common type of charting method which consists of four significant points; Each bar typically shows the open, high, low, and close (OHLC) prices for that period. This may be adjusted to only show the high, low, and close (HLC). Technical analysts use bar charts—or other chart types like candlesticks or line charts—to monitor the price performance of assets which aids in making trading decisions.
- Base Currency
- The currency in which your trading account is based.
- Basis Point
- One hundredth of one percentage point, or 0.0001.
- Basket of USD Short
- A number of operations where the USD is being sold against various currencies, instead of against a single currency.
- Bear (Bearish)
- A view taken by a trader going ‘short’ in the expectation of a decrease in the price of a currency. Being bearish is the belief that the price of an asset will fall.
- Bear Market
- A market in which share prices are falling, encouraging selling.
- Bid
- The highest buyer in the market at the time
- Bid / Ask Spread
- “Represents the difference between the buy (bid) and sell (ask) price of a foreign exchange pair. The BID represents the price at which the forex broker is willing to buy the base currency in exchange for the counter currency. Conversely, the ASK price is the price at which the forex broker is willing to sell the base currency in exchange for the counter currency. “
- Big Figure
- “Big figure’ is the stem, or whole dollar price, of a price quote. The term “”big figure”” is most often used in international currency markets, where it is often abbreviated to “”big fig.”” If AUD/USD is 1.04553, the big figure is 4. If GBP/USD is 1.58852, the big figure is 8.”
- Block
- A block refers to a collection of data related to transactions that are bundled together with a predetermined size and are processed for transaction verification which eventually becomes part of a blockchain. There is no official size designation constituting a block of securities, but a commonly used threshold is more than 10,000 equity shares or a total market value of more than $200,000.
- Blockchain
- A blockchain is decentralized, digital ledger where transactions made in bitcoin or other cryptocurrencies are recorded chronologically and publicly. They are the underlying technology of all cryptocurrencies and allow users to transact with each other without the need for trusted third parties (like banks, PayPal, Western Union etc).
- Blue Chip
- Shares of large and well-established organizations.Typically, the term ‘blue chips’ is used to refer to the constituents of the major stock indices. The term derives from the high value of blue casino chips
- Bollinger Bands
- Bollinger bands are a popular form of technical price indicator. The bands were designed to gauge whether the prices are high or low on relative basis. They are plotted two standard deviations above and below a simple moving average. The bands look like an expanding and contracting envelope model.
- Book
- The total number of currency positions a dealer has at any given moment. Typically, the dealer aims to have a net position of zero in terms of risk.The book shows the total amount of long and short positions that the trader has undertaken.
- Break Even
- A term used to describe when there is no overall profit or loss experienced in a transaction. In terms of price action, it is the level at which the risk on the trade is recovered.
- Breakaway Gap
- A price gap which occurs in the beginning of a new trend, many times at the end of a long consolidation period. A gap is the difference between the open price and prior close price, where no trading activity takes place. The price breaks away from the support or resistance via a gap, as opposed to an intraday breakout.
- Breton Woods Agreement
- The Bretton Woods Agreement, negotiated in July 1944, established a new international monetary system. It was developed by delegates from 44 countries at the United Nations Monetary and Financial Conference held that month in Bretton Woods, N.H. Under the agreement, other currencies were pegged to the value of the U.S. dollar, which, in turn, was pegged to the price of gold. The agreement lasted until 1971, when President Nixon overturned the Bretton Woods agreement and established a floating exchange rate for the major currencies.
- British Pound
- The currency of the United Kingdom. The full, official name is pound sterling.
- Broken Dates
- Broken date is a term used to describe a nonstandard maturity date for any type of financial deliverable. Broken dates can occur with options, futures, bonds and other trading instruments. Terms also used are odd dates,cock dates and broken period.
- Broker
- “An agent, who executes orders to buy and sell currencies and related instruments either for a commission or on a spread and works as an intermediary between the traders and the liquidity providers. It facilitates in the execution of clients’ orders. “
- Bull (Bullish)
- A view taken by a trader going ‘long’ in the expectation of an increase in the price of a currency. Being bullish is the belief that the price of an asset will appreciate.
- Bull Market
- A market characterized by rising prices.
- Bundesbank
- The Central Bank of Germany.
- Business Day
- A business day is a popular unit of time measure that typically refers to any day in which normal business operations are conducted.
- Buy Limit Order
- An order to execute a transaction at a specified price (the limit) or lower. By using a buy limit order, the investor is guaranteed to pay that price or less.
- Buy on Margin
- Buying on margin is the purchase of an asset by using leverage and borrowing the balance from a bank or broker. The word margin refers to the portion the investor puts up rather than the portion that is borrowed.
- Buying/ Selling Foreign Exchange
- “Buy Dollar/Yen” means buy the dollar/sell the Yen. Traders buy when they expect a currency’s value to rise and sell when they expect a currency to fall.
C
- Cable/Sterling
- Cable is a slang term for the exchange rate between the U.S. dollar (USD) and the British pound sterling (GBP).
- Cable/Sterling
- Cable is a slang term for the exchange rate between the U.S. dollar (USD) and the British pound sterling (GBP).
- Candlesticks
- A type of price chart used to display the high, low, open, and closing prices of an instrument for a specific period.
- Commission (Comms, or Transaction Fees)
- Amount payable by you to the service provider in respect of each Transaction.
D
- DAX
- Deutsche Aktien Xchange, Germany’s primary stock index that represents 30 of the largest and most liquid German companies.
- DMA (Direct Market Access)
- Model of pricing and execution where an order is placed directly, or virtually directly, into an Exchange without any broker intervention. In practice, there are many variations to the general model and brokers always retain the right to filter orders for regulatory or compliance reasons.
- Day Trade
- Opening and closing a position on the same day.
- Deal Blotter
- A list of all the deals occurred in a specific period, usually a trading day.
- Deal Ticket
- The primary method of recording all the terms, conditions, and basic information of a transaction.
- Dealer
- Dealers are people or firms who trade for their own account and risk, whether through a broker or otherwise.
- Dealing Desk
- In foreign currency markets, a dealing desk is where the forex dealers facilitate pricing and executing trades.
- Deficit
- A state in which liabilities exceeds the value of assets. A deficit is synonymous with shortfall or loss
- Delivery Date
- This is the date of maturity of a contract when the exchange of currencies is made. This date is also known as the value date.
- Demo Account
- A trading account that enables a potential trader to review and get to know the features of a specific trading platform using virtual money before engaging in actual trading.
- Depreciation
- A decline in the value of a currency in terms of a foreign currency due to market demand .
- Depth of Market
- The volume of buy and sell orders waiting to be transacted for a particular currency pair at a particular point in time.The depth of market measure provides an indication of the liquidity and depth for that particular security or currency.
- Derivative
- A security with a price that is dependent upon or derived from one or more underlying assets.
- Devaluation
- An intentional decrease in a currency’s price relative to another currency, group of currencies, or currency standard.
- Dividend
- A portion of a company’s profits paid to a class of its shareholder. Dividends are decided and managed by the company’s board of directors
- Drawdown
- The gap between the peak and trough decline of a specific recorded period of an investment
E
- ECN (Electronic Communication Network)
- Model of execution where an order is placed at a price sourced from a number of liquidity counterparties. In practice, there are many variations to the general model and brokers always retain the right to filter orders for regulatory or compliance reasons.
- ECN Broker
- A forex financial institution that uses electronic communication networks (ECNs) to enable clients to trade from prices obtained from a number of sources.
- EURO
- The official currency of the European Union, adopted by 19 of the 28 member states of the European Union.
- Earnings per Share (EPS)
- It is a financial measure, which indicates the profitability of a company, it is calculated as a company’s profit divided by the outstanding shares of its common stock.
- Easing
- Refers to a decline in interest rates due to central bank activity.
- Economic Indicator
- A statistic or data point that is used to measure current economic conditions.
- End Of Day Order (EOD)
- “A buy or sell order for securities requested by an investor. This order remains open until the end of the trading day which is typically 5PM ET. “
- Entry / Opening
- To execute an order in the market. The price is known as the entry or opening price.
- European Central Bank (ECB)
- Established in Frankfurt in 1998, the ECB is the central bank responsible for monetary policy of those European Union (EU) member countries ECB’s main responsibility is to ensure the EURO price stability.
- Exchange Rate
- This is the expression used to describe the value of one currency versus another. For example, how many U.S. dollars does it take to buy one euro?.
- Exit/Closing
- To create an order that is the opposite of a position that is currently held
- Exotic Currencies
- Refers to foreign currencies that are not popularly traded and are relatively illiquid.
- Expert Advisor
- A software that enables the analytical and trading processes in the trading platform to be carried out with little or no manual control. Expert advisors are most often deployed on the MetaTrader 4 or 5 forex trading platforms.
- Expiry Date
- The date on which the holder of an option can exercise his right to buy or sell the underlying security. is usually 2 business days before the settlement date.
- Exposure / Market Exposure
- Amount in dollar, or percentage of capital that is being invested in a particular type of security, marketsector or industry.
F
- Federal Reserve
- Also commonly referred to as Fed. It is the central bank of the U.S. and the organization responsible for monitoring and maintaining the United States currency supply. It oversees the monetary and financial system in the U.S.
- Fees
- Cost associated to products and services of the broker, but not the trade.
- Fiat Currency
- Fiat money is government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it. In a fiat currency system, the currency value rises and falls on the market in response to demand and supply pressures.
- Fill
- The process of executing an order to make a transaction.
- Finance
- Financing is applicable on all CFD positions held overnight. The financial rate is applied to the full value of your position. If you hold a long ‘buy’ position you will be charged a financial interest, if you hold a short ‘sell’ position you may receive interest.
- Financial Instrument
- Financial instruments are assets that can be traded. Examples include currencies, futures, options, and CFDs.
- First In First Out (FIFO)
- First In, First Out, commonly known as FIFO, is an asset-management and valuation method in which assets produced or acquired first are sold, used, or disposed of first. All positions opened within a particular currency pair are liquidated in the order in which they were originally opened.
- Foreign Exchange Market
- A Market where foreign currencies are traded internationally. Participants are able to buy, sell, exchange and speculate on currencies. Foreign exchange markets are made up of banks, forex dealers, commercial companies, central banks, investment management firms, hedge funds, retail forex dealers and investors.
- Forex
- The short form of foreign exchange.
- Forward Points
- The value of the interest rate differential for a currency pair over the period from the spot settlement date to the forward settlement date, When points are added to the spot rate this is called a forward premium; when points are subtracted from the spot rate it is a forward discount.
- Fundamental Analysis
- Fundamental analysis (FA) is a method of measuring a security’s intrinsic value by examining related economic and financial factors, and other qualitative and quantitative aspects that affect the performance of a particular financial instrument.
- Fundamentals
- Fundamentals include the basic qualitative and quantitative information that contributes to the financial or economic well-being and the subsequent financial valuation of a company such as inflation, interest rates, commodity prices and economic activity.
- Futures
- Futures are derivative financial contracts that obligate the parties to transact an asset at a predetermined future date and price. The difference between a Forward and a Future is that forwards are traded over the counter (OTC) while Futures are typically traded over an exchange.
- Futures
- Contract between two parties to buy or sell a specified asset of standardized quantity and quality for a price agreed today.
G
- G7
- “Is the seven leading industrial countries: The United States, Germany, Japan, France, United Kingdom, Canada, and Italy. “
- GDP
- Abbreviation for Gross Domestic Product. Is the total value of a country’s output, income or expenditure produced domestically.
- GNP
- Abbreviation for Gross National Product, It is Gross domestic product added to income from investment.
- GTC
- Abbreviation for Good Till Cancelled. It is an order to purchase or sell a particular financial instrument at a set price but this order is only valid and remains active until either the order is filled or the investor cancels it.
- Going Long
- Going long refers to opening a buy CFD position to profit from a price increase..
- Going Short
- Going short refers to opening a sell CFD position to profit from a price decrease.
- Gold Certificate
- A gold certificate is a paper document that represents a claim on a specified amount or value of gold that investors use to purchase and sell the commodity instead of dealing with transfer and storage of the physical gold itself.
- Golden Cross
- The golden cross is a candlestick pattern that is a bullish signal in which a relatively short-term moving average crosses above a long-term moving average. This is considered a favourable sign that the underlying currency will move in the same direction.
- Goldilocks Economy
- To steal a line from the popular children’s story Goldilocks and the Three Bears. A term that describes an economy that has steady growth and acceptable inflation. In this sense, the economy is not too hot and not too cold.
- Grid Trading
- Grid trading is when orders are placed above and below a set price, it is most commonly associated with the foreign exchange market.
- Gross Liquidation Value (GLV)
- Your GLV is the total value of your account if you closed out all positions at the current market price minus any transaction charges or adjustments. If your GLV goes below 0, you will be in debt.
H
- Hard Currency
- Hard currency refers to currencies that are issued by nations that are seen as politically and economically stable. Examples could be the US Dollar or the Euro.
- Head and Shoulders
- The Head and Shoulders chart pattern is considered by many traders and analysts to be one of the most reliable and accurate of all reversal patterns. In technical analysis, a head and shoulders pattern describes a specific chart formation that predicts a bullish-to-bearish trend reversal.
- Hedge
- An investment to reduce the risk of adverse price movement in another investment or an asset, normally consisting of taking an offsetting position in a related security
- Hit the Bid
- “Hit the bid is a buzzword used to describe an event where a trader accepts purchasing at the offer or selling at the bid. “
- Holder
- The buyer/holder of a currency pair.
I
- IFEMA
- International Foreign Exchange Master Agreement
- In the Money
- A phrase used to show when a trader makes profit.
- Inconvertible Currency
- A Foreign Currency which cannot be exchanged for other currencies.
- Index
- An Index is a measurement of the value of a section of the stock market. Some of the most popular indices are the S&P 500, NASDAQ and the FTSE 100.
- Indices
- An aggregate statistical measure of a particular market. E.g., the ASX S&P200 seeks to measure the value of the top 200 stocks on the ASX.
- Inflation
- is a quantitative measure of the rate at which the average price level of a basket of selected goods and services in an economy increases over a period of time. This is sometimes referred to as an excessive movement in such price levels.
- Initial Margin
- Initial margin is the percentage of the purchase price of a security that must be covered by cash or collateral when using a margin account.
- Initial Margin
- Every trader in the ASX CFD market is required to put up an Initial Margin (deposit) for each contract they trade. This applies to both buyers and sellers. This Initial Margin is returned when the contract is closed out. The amount is normally set at a level designed to cover reasonably foreseeable losses on a position between the close of business on one day and the next. The amount of Initial Margin for each contract varies according to the price volatility.
- Instrument
- A tradeable asset or negotiable item – such as security, commodity, derivative, index or any item that underlies a derivative.
- Inter-bank Rates
- The foreign exchange rates that large international banks quote to other large international banks. The basis of the Interbank market.
- Inter-dealer Broker
- A specialist broker who acts as an intermediary between market-makers who wish to buy or sell securities to improve their book positions, without revealing their identities to other market-makers.
- Interest Rate
- The interest rate is the amount a lender charges for the use of assets expressed as a percentage of the principal. An interest rate is expressed as an annual percentage of the principal. Interest rates often change as a result of inflation and Central Bank policies.
- Interest Rate Differential
- The difference between the interest rates applicable to a currency pair. Traders in the foreign exchange market use IRDs when pricing forward exchange rates.
- Introducing Broker
- is a broker in the futures markets who has a direct relationship with a client and introduces customers to a market maker often in return for commission or a portion of the spread.
- Iress
- Trading platform used primarily to trade equity CFDs.
J
- Japanese Yen
- The Yen is the Japanese currency unit. It comes third in place after United States dollar and the Euro as the most-traded currencies in the foreign exchange market .
- Jobber
- A trader who trades short-term profits during the course of a trading session, rarely leaving a position overnight.
K
- Key Currency
- It’s a stable currency, one that doesn’t fluctuate too wildly and provides the foundation for exchange rates for international transactions. Because of their global use, key currencies tend to set the value of other currencies.
- Kill
- An order that is to be cancelled between its placement and its fulfillment.
- Kiwi
- “Traders term for the New Zealand Dollar because of the national bird found stamped on the one-dollar coin. “
L
- LIBOR
- The London Inter-Bank Offered Rate, it is used as a reference rate by banks to borrow from other banks.
- Lagging Indicators
- Statistics that change after the economy has already started to change or has started to follow a particular direction or trend. They can be useful for gauging the trend of the general economy, as tools in business operations and strategy, or as signals to buy or sell assets in financial markets.
- Leading Indicators
- Leading indicators are used by traders to predict imminent changes in a market, such as the levels of the S&P 500 index.
- Leverage
- When trading with borrowed capital, you are trading with leverage
- Leverage
- The ratio of amount used in a transaction to the required deposit. With a deposit of $1000 and a leverage of 100, a trader could enter a position with a face value of $100,000.
- Liability
- A debt or another type of obligation. In speculative forex trading, currency is not delivered. All profits and losses are added to or subtracted from margin deposits.
- Limit Order
- An order to transact at a specified price or better. Can be used to control how much profit and how much loss a trader is willing to handle.
- Liquidation
- A liquidation is forced closure of positions due to the equity in your account not being able to support the margin requirements of the open positions – A position can also be Auto liquidated, your GLV is 50% of your margin requirement
- Liquidity
- Degree to which an asset or security can be bought or sold within the market without affecting the asset’s price.
- Long Position
- also known as ‘long’ is a position that becomes beneficial as market price rises. Holding a long position is a bullish view.
- Loonie
- Dealer slang for the USA/CAD currency pair.
- Lots
- A lot is the term used to describe the amount for a standard contract. For example, 1 lot of gold refers to 100 troy ounce of gold. 1 lot of AUDUSD refers to $100,000 AUD worth of US Dollar
M
- MT4/Metatrader 4
- Trading platform used primarily to trade FX.
- Margin
- Margin is the money borrowed from a brokerage firm to purchase an investment. the required initial deposit of collateral to enter into a position or foreign exchange trade.
- Margin Account
- It’s a brokerage account in which the broker lends the customer funds to engage in securities transactions.
- Margin Call
- When your free equity drops below 0. Your position can be liquidated at any point when you are in margin call.
- Mark-to-Market
- A system whereby the value of an open position is revalued against the current market for the purpose of calculating variation margins.
- Market Order
- An order to buy or sell a financial instrument at the best available price in the current market.
- Market Price
- The current price at which a financial instrument is being traded in the market.
- Market Risk
- The possibility that a trader will incur losses due to changes in market prices.
- Maturity Date
- Is the date on which, under the contracted agreements, the foreign exchange becomes due.
- Maximum Leverage
- Maximum leverage is the largest allowable size of a trading position permitted through a leveraged account. At a leverage of 50, one could enter a maximum leveraged position of $100,000 by depositing $2,000 worth of margin.
- Mine and Yours
- Used by floor traders to signify buying and selling. For purchasing something, they say “Mine”. If they want to sell, they say “Yours”.
- Mio
- One million or 1,000,000.
- Monetary Policy
- Is the process by which a monetary authority controls the money supply in the economy, usually this authority is the Central Bank.
- Moving Average
- The average of prices over a given time. It may be used as a curving trend line that follows the price action.
N
- NASDAQ
- Is a global electronic marketplace for buying and selling securities in the U.S.
- NOK
- Interbank Rate Resistance Currency symbol for the Norwegian Krone.
- NYSE
- The New York Stock Exchange.
- NZD
- the currency symbol for the New Zealand Dollar.
- Net Position
- The amount of currency bought or sold that have not been offset with opposite positions.
- News Trader
- An investor who bases his/her decisions on the outcome of news announcements, Breaking news, economic reports etc., and its impact on the market.
O
- OTC (Over the Counter) contract
- Contract for a financial product, including options and contracts in respect of foreign exchange or metals. OTC contracts are not traded or settled with any Exchange.
- Odd Lot
- A non-standard transaction size. Odd lots are considered to be anything less than the standard 100 shares for stocks.
- Offer
- The price at which a dealer is willing to sell. The lowest price available is the best offer .
- Offsetting transaction
- A trade with which serves to eliminate or cancel some or all of the market risk of an open position, it can mean closing a transaction or taking another position in the opposite direction to cancel the effects of the first.
- One Cancels Other Order (O.C.O. Order)
- A designation for two orders whereby if one order executes, the other order is automatically canceled.
- Open order
- An order that is running in the market until a specified market price is reached, then it will be executed.
- Order
- An investor’s instructions to a brokerage firm to either buy or sell a security on the investor’s behalf.
- Overnight Position
- A trading position that remains open overnight and until the next trading day.
P
- P&L
- Profit and Loss
- Payout
- Refers to the expected financial return from a successful trade.
- Pegged
- Controlling a currency’s value by tying it with the rate of another currency.
- Pip
- A pip is the smallest price movement in a currency pair exchange rate.
- Pip / Points
- The smallest increment by which a unit of currency (such as for an FX FPM OTC contract) changes and is quoted depending on the number of decimal places in which the currency is quoted. For example a USDJPY margin FX is quoted with only two decimal places (meaning one Pip Value (or “Point”) = JPY 0.01).
- Position
- The netted total exposure in a given currency. A position can be either flat or square ( no exposure), long, (more currency bought than sold), or short ( more currency sold than bought).
- Position size
- The size (e.g., number of shares) or the dollar amount of an particular investment placed.
- Premium
- Amount by which a currency’s forward price has exceeded the current market price.
- Principal Value
- The original amount that an individual invests for trading in the financial markets.
- Private Key
- The private key is the encrypted series of letters and numbers used to access the cryptocurrency wallet and to sign transactions. It is essentially like the password for your cryptocurrency holdings.
- Public Key
- The public key is basically the cryptocurrency address used to encrypt a message. This is the code that you give out when requesting a payment.
- Put Option
- Also known as a “Low option” a contract giving the owner the right to sell a specified amount of an underlying security at a specified price
Q
- Quote
- An indicative market price quoted for information purposes but not to deal.
- Quote Currency
- The second currency in a currency pair. Also called counter currency.
R
- Rally
- A recovery in price after a period of decline.
- Range
- The difference between the highest and lowest price of a future recorded during a given trading session.
- Rate
- Price at which a currency can be purchased or sold against another currency.
- Realized P/L
- Realized P/L
- Rebate
- Also called refund. It is the portion or the entire invested amount given back to the investor at the end of a trade.
- Reciprocal Currency
- A currency pair involving the US Dollar in which the US Dollar is not the first currency quoted. An example is the Euro, which is the base currency when paired with the US Dollar. EUR/USD is the way of quoting these two currencies.
- Relative Strength Index (RSI)
- A technical oscillating indicator used to measure the overbought and oversold conditions of a financial instrument.
- Resistance
- Price level at which technical analysts note persistent selling of a currency.
- Risk Management
- A system that identifies, measures, seeks to reduce and reports/monitors risk to avoid losses.
- Rollover
- An overnight swap, specifically the next business day against the following business day (also called Tomorrow Next, abbreviated to Tom-Next).
- Round Trip
- Buying and selling of a futures or options contract.
- Rule based Trading
- A system of rules for evaluating stocks and identifying trading opportunities.
S
- SEC
- US Securities and Exchange Commission.
- Satoshi
- A Satoshi is the smallest unit of a bitcoin, which is the eighth decimal place. It was named in honour of Satoshi Nakamoto, the inventor of bitcoin.
- Scalping
- A trading strategy that involves opening and closing short-term positions with the intention of making accumulated profits.
- Security
- Another term for a financial instrument
- Security
- A tradable financial instrument of any kind.
- Security Exchange Commission (SEC)
- The U.S. government agency that oversees and regulates the national securities industry, stock markets and electronic securities markets.
- Sell Limit Order
- An order to execute a transaction only at a specified price (the limit) or higher.
- Sell Stop
- A limit order with a limit placed below the current market price. Once triggered, the limit order becomes a market order.
- Settlement
- The process by which a trade is entered into the books and records of the counterparts to a transaction. The settlement of currency trades may or may not involve the actual physical exchange of one currency for another.
- Short Position
- Excess of sales over purchases or of foreign currency liabilities over assets.
- Simple Moving Average (SMA)
- A simple average of a pre – defined amount of price bars. For example, a 50 period Daily chart SMA is the average closing price of the previous 50 daily closing bars. Any time interval can be applied here.
- Slippage
- Difference between the price of trade and actual execution. Often occurs at the stage of high volatility, where the fluctuation of price is high.
- Spot
- Foreign exchange bought and sold for delivery two business days after the deal is firmed.
- Spot Market
- A physical market in which foreign currencies and commodities are bought and sold for cash at the current market price, settled “on the spot” and delivered immediately.
- Spot Price
- The current market price. Settlement of spot transactions usually occurs within two business days.
- Spot Price
- The present exchange rate at which traders can buy or sell a particular financial instrument.
- Spot Trade
- The purchase or sale of a foreign currency or commodity for immediate delivery (as opposed to a date in the future). Spot contracts are settled electronically.
- Spread
- Difference between the bid and ask price.
- Square
- Purchase and sales are in balance and thus the dealer has no open position.
- Sterling
- Another name for the British Pound (GBP). The full, official name, pound sterling, (plural: pounds sterling).
- Stochastic
- An oscillating indicator that determines the level of change of the price of a financial instrument from one closing period to the next.
- Stock
- Representation of a share in the ownership of a company that is available for trading on the financial markets.
- Stop-buy
- A buy order for a currency price that is above the current market, or current price. It becomes a market order when the specified price is reached.
- Strike Price
- The value of a financial instrument at the time when it is bought or sold.
- Support Levels
- A technique used in technical analysis that indicates a specific price ceiling and floor at which a given exchange rate will automatically correct itself. Opposite of resistance. Swapkeyboard_arrow_downSwissykeyboard_arrow_down
- Swap/roll over
- An agreement between 2 parties to exchange financial instruments. Brokers may undertake a swap agreement with Prime Brokers to take positions on financial markets
- Swiss
- Trader’s nickname for the Swiss Franc.
T
- Take Profit Order
- A customer’s instructions to buy or sell a currency pair which, when executed, will result in the reduction in the size of the existing position and show a profit on said position.
- Take Profits
- A limit order that is placed above the market with a long position or below the market with a short position. When the market reaches the limit price, the position is closed thereby locking in a profit.
- Technical Analysis
- Is concerned with past price and volume trends and often with the help of chart analysis in a market in order to be able to make forecasts about future price developments of the commodity being traded.
- Technical Correction
- An adjustment to price not based on market sentiment but technical factors such as volume and charting.
- Term
- The period from and including the trade date to and including the settlement date.
- Thin Market
- A market in which trading volume is low and in which consequently bid and ask quotes are wide and the liquidity of the instrument traded is low.
- Tick
- The smallest possible change in a price, either up or down. Also known as a pip.
- Ticker
- Streaming display of the current or recent historical price of a currency pair.
- Tomorrow Next (Tom Next)
- Simultaneous buying of a currency for delivery the following day and selling for the spot day or vice versa.
- Trade Balance
- Measures the difference in value between imported and exported goods and services. Nations with trade surpluses (exports greater than imports), such as Japan, tend to see their currencies appreciate, while countries with trade deficits (imports greater than exports), such as the US, tend to see their currencies weaken.
- Trader
- The date on which a transaction is entered into.
- Trading Plan
- A strategy on what, and how, you will place a trade.
- Trading Platforms
- A software application used for trading forex, usually over the Internet.
- Trailing Stop
- A water mark stop loss that tracks the movement of the underlying security
- Transaction Cost
- The cost involved in buying or selling a currency pair. Some consider the transaction cost to be the actual value of the contract, while others feel it is the price of facilitating the trade, such as commissions and spreads.
- Transaction Date
- The date upon which the trading of a financial instrument takes place.
- Transition Period
- The period from and including the trade date to and including the settlement date.
- Trend
- The current direction of the market, whether up or down or sideways (which is sometimes referred to as non-trending or trading market).
- Two-Way Quotation
- When a dealer quotes both buying and selling rates for foreign exchange transaction.
U
- Unconvertible Currency
- A currency that cannot be exchanged for another because of foreign exchange regulations.
- Under-Valuation
- An exchange rate that is usually regarded to be undervalued. This happens if it does not exceed its purchasing power parity.
- Underlying Assets
- The asset which a derivative’s price is based on. E.g., an equity CFD on BHP has an underlying asset of a of share of BHP.
- Unemployment Rate
- The percentage of people within the labor force who are considered to be without jobs.
- Unit
- A widely used quantity of currency. In forex trading, one unit of USD is equal to one United States dollar, while one unit of EUR is one Euro. For JPY, one unit is equivalent to one Yen. One unit is the smallest trade size in Forex trading.
- Unrealized Gain/Loss
- The theoretical gain or loss on Open Positions valued at current market rates, as determined by the broker in its sole discretion. Unrealized Gains’ Losses become Profits/Losses when position is closed.
- Up-Tick
- A transaction executed at a price greater than the previous transaction.
- Up-Tick Rule
- In the U.S., a regulation whereby a security may not be sold short unless the last trade prior to the short sale was at a price lower than the price at which the short sale is executed.
- Us Prime Rate
- The interest rate at which US banks will lend to their prime corporate customers.
V
- VIX or Volatility Index
- Shows the market’s expectation of 30 – day volatility. It is constructed using the implied volatilities of a wide range of S&P 500 index options. The VIX is a widely used measure of market risk and is often referred to as the “investor fear gauge”.
Volatility
- VPS (Virtual Private Server)
- A virtual private server (VPS) is a virtual machine sold as a service by an Internet hosting service. Traders use this to host their MT4 platform so that their trading strategies i.e. EAs can run 24 hours 5.5 days a week.
- Value Date
- For exchange contracts it is the day on which the two contracting parties exchange the currencies which are being bought or sold. For a spot transaction it is two business banking days forward in the country of the bank providing quotations which determine the spot value date. The only exception to this general rule is the spot day in the quoting centre coinciding with a banking holiday in the country(ies) of the foreign currency(ies). The value date then moves forward a day. The enquirer is the party who must make sure that his spot day coincides with the one applied by the respondent. The forward months maturity must fall on the corresponding date in the relevant calendar month If the one month date falls on a non-banking day in one of the centres then the operative date would be the next business day that is common. The adjustment of the maturity for a particular month does not affect the other maturities that will continue to fall on the original corresponding date if they meet the open day requirement. If the last spot date falls on the last business day of a month, the forward dates will match this date by also falling due on the last business day.Also referred to as maturity date.
- Value Today
- A transaction with a settlement date that is on the same day as the trade date.
- Value Tomorrow
- A transaction with a settlement date that is 1 business day after the trade date.
- Variation Margin
- Refers to the payment of profits or losses following revaluation of a CFD contract. For this purpose, open positions are revalued (or marked-to-market) daily.
- Virtual Balance
- Your current potential account balance that can be realized by closing all your open trades. For example, if your actual account balance is $925 and you have an open trade for $50 with a $25 profit, your virtual account balance will show $1,000.
- Volatility
- A measure of the extent to which the exchange rate changes over a given period.
- Volatility
- Indication of the movement of price in the instrument in question. Highly volatile instrument fluctuates rapidly in price, while low volatile instrument is (relatively) stable in price.
- Volume
- The number, or value, of securities traded during a specific period.
W
- Wallet
- A wallet is simply somewhere that you can keep your cryptocurrency holdings. Crypto wallets are divided into: Software wallets, which can be installed on your computer. Mobile wallets, which are available for mobile devices. Web wallets, which are hosted online and are available through any web browser. Paper wallets, which are made by printing your public and private keys (or QR codes) on a piece of paper and securing it the old fashioned way. Hardware wallets, which are small USB devices that hold your private keys and so must be plugged into your computer for you to be able to sign a transaction.
- Wedge Chart Pattern
- Chart formation that shows a narrowing price range over time, where price highs in an ascending wedge are incrementally less, or in a descending wedge, price declines are incrementally smaller. Ascending wedges typically conclude with a downside breakout, and descending wedges typically terminate with upside breakouts.
- Whipsaw
- Slang for a condition of a highly volatile market where a sharp price movement is quickly followed by a sharp reversal.
- Wire Transfer
- The electronic transfer of money from one financial institution to another.
- Working Day
- A day on which the banks in a currency’s principal financial centre are open for business. For FX transactions, a working day only occurs if the bank in both (all relevant currency centres in the case of a cross) are open.
X
- X
- It is a NASDAQ stock symbol. It gives a representation of a mutual fund.
- XAG
- A currency symbol of silver. It is precious metal with the highest electrical conduction properties of any metal. It is used mainly in jewellery, photography, and for scientific and industrial purposes. It has been used as the basis for currencies in the past. Silver is traded as a commodity on various security exchanges. Like many precious metals, silver is volatile but generally maintains relatively high prices.
- XAU
- XAU is the currency code for gold. By popular demand, here are live gold bullion prices in eleven major currencies, US Dollars XAU/USD, Pounds Sterling XAU/GBP, Euros XAU/EUR, Australian Dollars XAU/AUD, Canadian Dollars XAU/CAD, Hong Kong Dollars, Rands XAU/ZAR, Rubles XAU/RUB, Rupees XAU/INR, Swiss Francs XAU/CHF, Yen XAU/JPY.
- XAU/USD
- XAU/USD exchange rates for Gold to U.S. Dollar Starting July 15th, 2011
- XE
- Abbreviation for Xpress Engine. It is one of the most visited financial sites that provide useful tools to traders.
Y
- Yard
- A traders’ term for a billion as in a billion dollars.
- Yield Curve
- A graph that illustrates the correlation between the interest rate and the time to maturity of the debt instrument for a particular borrower using a particular currency.
Z
- ZAR
- The currency symbol of the South African Rand.
- Zero-Bound
- A situation whereby interest rates are very low (close to zero percent), making it difficult for central banks to institute measures for stimulating expansion of the economy.
