Tabs

A

Absolute Advantage 

The ability of an organization, central bank or government to produce a higher level of goods or services in comparison to competitors under the same circumstances.

AML

Anti-Money Laundering refers to regulations and procedures put in place in order to prevent criminals from disguising illegally obtained funds

Appreciation

The increase in value or price of the asset over time.

Arbitrage

This is the simultaneous action of buying and selling financial instruments in two different markets in order to profit from different prices in the same asset.

Ask Price 

The ask price is also known as the offer price is the price which a seller is willing to accept offers at.

Assets

A financial product which can be traded between investors.

Asset Class

Investments are split up into different classes. The instruments are grouped depending on their similar characteristics. Each group is known as an asset class.

ATH

All Time High

Aussie 

A nickname which the Australian Dollar may be referred to by.

Austerity

Austerity refers to when government reduces public spending, normally in order to reduce the government’s deficit. Austerity can include different changes to the fiscal policy such as public wage cuts and further taxes.

Balance

Balance is the figure which indicates capital within a trading account including closed profit and loss but not figures from open trades.

Bar Chart 

A type of chart which shows the opening price, closing price, price highs and lows within a specific timeframe.

Bailout 

A financial term referring to a high amount of lending or even a gift of capital to either a company or bank to danger or certainty of bankruptcy. 

Bankruptcy

Bankruptcy refers to the legal court procedure due to a firm’s inability to pay debt due to either loss of income, increased expenditure, or even possibly an unforeseen financial crisis.

Base Rate

A financial term referring to a high amount of lending or even a gift of capital to either a company or bank due to danger or certainty or bankruptcy.

Bear/Bearish

The term is used by traders when referring to an asset which is or may depreciate in value. Bears are known as individuals with a bearish perspective on the market or a specific asset. 

Bid Price 

The bid price is the figure which buyers in the market are willing to purchase the instrument at.

Bond

A bond is a financial asset used by federal and private organizations to borrow money from the public with the intent to pay back within a fixed period with interest. 

Bond yields

Bonds are released with an interest rate at the end of a fixed period. The Bond Yield is referring to the amount of interest which the investor should receive on the investment. The yield may derive from the value of the investment or/and the interest rate.

Broker

A broker is an intermediary which connects investors with the financial trading market.

Bulls/Bullish 

Bulls are the opposite of Bears. Bulls have a positive opinion on an asset’s price or market. Bullish describes a price which is or may increase.

Buy 

To purchase or speculate that an asset will increase in value.

Cable 

A nickname making reference to the GBP/USD

Candlestick Charts

A candlestick chart is a chart style which shows both the opening and closing price, as well as the price highs and lows within a specific timeframe. The style is similar to a bar chart but has visual differences.

Central Banks

 A central bank is a financial institution which controls the production and distribution of money as well as credit within a state. Normally the central bank will control monetary policy as well as regulate part of the banking sector. 

CDF

CDF is an abbreviation standing for contract for Difference. CDFs are tradable financial derivative which give individuals the option to speculate the market without owning the underlying asset. CDFs are normally traded using leverage. 

Closing Price 

The price which the financial instrument was traded to close a position. It can also refer to the last price within a session.

Collateral

An asset which is given as security in order to secure a loan. If the borrower is unable to repay the loan, the lender may take legal proceedings to take ownership of the security.

Commission

A fee that is charged for buying or selling a product.

Commodities

Physical goods which are traded on the financial exchange markets similarly to financial instruments. Commodities are split up into smaller subcategories such as metals, energy and agricultural products.

Common Stocks

A common stock gives individual’s ownership of an organization’s share with voting rights. However, the shares are classed as second in line when it comes to dividends payment. Preference stocks are first to receive dividends but have no voting rights.

Contracts

The trade size within the financial trading market. Depending on the market and the asset, the contract may be measured differently. For example, currencies are contracted in Lots whereas Gold is traded using ounces

Counterparty

One of the participants within a financial transaction. 

CPI

Consumer Price Index which measures the average price of consumer goods and services purchased by households. The products/ services measured within the index is fixed.

Cross Currencies

Cross currencies also known as Minor Currency pairs are pairs which do not include the US Dollar. Common Cross Currency pairs include either the Euro, Pound or Japanese Yen.

Currency Pairs

The exchange rate between two currencies. There are three types of currency pair; Major, Minor and Exotic.

Currency Symbol

The symbol which is used to represent the product. Normally the trading symbol will be an abbreviation. 

Correlations

When the price of an asset is linked to the price movement of a separate asset. The market has both positive correlations and inverse correlation. For example, the US Dollar and Gold.

Daily Cut-off 

The point of day at which the trading day is over and trading stops. Traders will no longer be able to open and close trades.

Day Trading

Day Trading is a trading strategy which involves opening and closing trades within the same trading day. One of the benefits of day trading is avoiding swap fees. 

Dealer/Dealing

A dealer is a financial intermediary that stands ready to buy or sell assets with its clients. The dealing company trades on their own account and risk as the investors are trading against the dealing desk. This is in contrast with A BOOK brokers which simply acts as an intermediary.

Debt to GDP Ratio

Debt to GDP Ratio is simply a figure measured in a percentage which shows the country’s debt compared to its GDP. The figure is important as it indicates the ability of the country to pay back its debts based on its output and transactions. The lower the figure, the lower the risk of default.

Debtors

An individual or company which owes capital

Decentralized

Meaning the asset or market is not controlled by any single institution, for example, a central bank or central exchange.

Deflation

A decrease in the general price level within an economy. Country’s will normally use a basket of assets and services in order to determine the rate of deflation or inflation.

Demand Shock

An unexpected change in demand, such as a rise or fall in autonomous consumption, investment, or export

Demo Account

Known as a practice account whereby traders can trade the market via fake capital and trades. This way the individuals are able to experience the trading market without risking capital.

Depreciation

Depreciation refers to the price of an asset decreasing in value.

Disinflation

The decrease in the level of inflation but not necessarily showing a figure of deflation.

Disposable income

Income available after an individual’s taxes have been paid. Countries have indexes which measures the average disposable income and can be used to determine economic conditions and sustainability. 

Dividends

Dividends are the payment received by shareholders from the company’s earnings. The amount of dividends paid is determined by the group of directors.

DOM

The DOM stand for Depth of Market. This is a tool which can be used on most platforms and is used to illustrate the supply and demand levels for liquid, tradable instruments.

Double Bottom 

A Double Bottom is a technical term used for an asset which price collapses on two occasions and finds support at the same levels of support and often indicates a strong change of trend.

Dovish

The Term “Dovish” is normally referring to comments regarding monetary policy. Dovish is when the central bank is unlikely to take aggressive actions such as increasing interest rates.

ECN

An Abbreviation for ECN. An ECN broker is known as a 100% intermediary and not holding any trades in-house. The ECN method is a technology and structure which connects investors with numerous liquidity providers which may be both banks and non-bank organizations.

Economic Calendar

An economic calendar is a calendar which states all the economic events in the market scheduled to be released including days and times. Traders use economic calendars to keep up to date with market news.

Economic indicators

Economic indicators are used by traders to evaluate the economic, a specific market or asset. Indicators can use various indices, earning reports, economic summaries and figures such as inflation rates, employment figures and interest rates.

Elliot wave theory

The theory follows the ideology that the market trends to follow a repeating pattern which is driven by trader psychology regarding price action. Regardless of market conditions and developments the theory advises the price will primarily follow an impulse wave and corrective wave pattern.

Employment Change 

The employment change is a report issued by government which measures the total number of individuals which have either lost or gained employment during the previous month. The figures can be positive or negative.

Endowment 

A pool of financial assets for a specific purpose in accordance to the objective of its founders and donors.

Equity 

The balance within the account which takes into consideration both closed and open profit and loss.

Eurobonds

A Eurobond is an international debt instrument which is denominated in a currency not native to the country where it is issued. Named after Eurozone where the instrument was first introduced. 

Eurozone

The Eurozone or Euro Area is an economic union of 19 member states of the European union that have adopted the Euro as their primary currency.

Excess demand/supply

Excess demand refers to conditions where the demand is higher than the supply in the market. Excess supply refers to conditions where the supply is higher than the demand in the market. Both can cause high levels or volatility.

Exchange rate risk

The potential loss of capital or value due to an adverse price movement in an exchange rate.

Exotic pairs

Exotic currency pairs refer to pairs which also include thinly traded currencies but at the same time will still include a major currency for example, USDHKD, EURMXN and JPYNOK

Exports

Exports refers to any good, commodity or service sold abroad.

Fading

Fading makes reference to a technique used by traders by which they monitor the momentum in the price movement to determine when the movement may fade due to being oversold in the short term. This is mainly used by traders in order to avoid a retracement in the price.

Fake out

A fake out is a false breakout that occurs when the price moves outside of a chart pattern but then moves right back inside it. This is known to cause buyers and sellers in the market which get mislead by the government in the market.

FCA

The financial conduct Authority is the UK regulator which regulates the financial services market.

FDI

Direct foreign investment is an investment made by a firm or individual in one country into business interests located in another country.

Federal reserve

The American Central Bank which controls monetary policy.

Fiat Money

Fiat money is a currency which is issued by the government that is not backed by a commodity such as Gold. The value of Fiat money is mainly derived from Supply and Demand.

Fictional unemployment 

Fictional unemployment is known as the unemployed who are so voluntarily. For example, it may be due to an intermission between a change of employment. 

Financial risk

Financial Risk is the risk of loss through an investment, savings product or business venture.

Fiscal Policy

A Fiscal policy refers to the government’s policy relating to revenue and expenditure. Fiscal policies can be altered to influence the economy.

Fiscal Stimuli

Fiscal stimulus is method taken by the government to increase government spending and/or cut taxes in order to support the economy and prompt growth.

Fishers Effect

The fisher effect is a theory which describes the relationship between country’s inflation and the central bank’s interest rates.

Foreign bonds

A foreign bond is a debt instrument issued in a regional market by a foreign entity in the domestic markets’ currency as a means of raising capital. For example, a US Company issued foreign bonds in Greece in Euros.

Forex

Forex is a term which references to the foreign exchange market.

Forex Trading Robot

A software which is implemented on the trading platform which trades automatically normally based on technical aspects of the markets such as trends, support and resistance.

FRC

The federal Reserve Committee makes key decision about interest rates and the growth of the united states money supply which both have a strong effect on the US Dollar and economy

Fundamental Analysis

Fundamental Analysis is a method of market analysis based on evaluating how economical figures and events can affect the supply and demand of a currency or asset and consequently the price.

Futures Contract

Futures are derivatives meaning that traders are speculating on price movement without actually owning the underlying asset. The buyer must purchase or the seller must sell the underlying asset at the set price, regardless of the current market price at the expiration date. 

G7

Group of 7 nations – United states, Japan, Germany, France, Italy, United Kingdom and Canada.

Gap

A market gap references the point which prices moves significantly fast causing a gap in price without any trades occurring. Gaps usually follow economic data or news announcement.

GDP/Gross Domestic Product

Gross Domestic Product is the value of all goods and services made within a country during a specific period. GDP is worked out as follows GDP = Consumption + Investment + Government spending + Net exports. GDP provides an economic snapshot of a country, used to estimates the size of an economy and growth rate.

Government Budget Balance 

The government’s budget takes into consideration the government

S revenues and spending within a financial year. A positive figure is known as budget balance surplus and a negative figure is known as budget deficit.

Government Failure

Poor economic conditions caused by government intervention.

Government Revenue

The government’s revenue obtained through taxes, ventures and non-tax sources to enable it to undertake government expenditures and general fiscal actions.

Greenback

The nickname for the US Dollar.

Gross income

Gross income is the total income from all sources before the deduction of taxes and other deductions such as private pensions and social insurance.

Gross National Product

GNP is the estimated total value of all the products and services turned out in a given period by the means of production owned by a country’s residents. Should not be confused with GDP which has a very different formula.

Guaranteed Order

An order type that protects a trader against the market gapping. It guarantees to fill your order at the price asked. 

Gunning/Gunned

Refers to traders pushing to trigger known stops or technical levels in the market.

Halving

Halving is a preprogramed method to control the supply of a currency by reducing the mining reward by half

Hammer candlestick

Referring to a candlestick which has formed a small high body with a long tail or shadow 

Hard currency

A hard currency refers to capital that is issued by a country that is viewed as economically stable.

Hawk/hawkish

This is a word used to describe a personal or a comment which is in favor of a tighter monetary policy. For example, an article may state that the chairman’s comments were extremely hawkish, meaning he was in favor of a stronger monetary policy.

Headline risk

This is the risk that the media and general news stories will adversely affect the price of the assets. This is possible even if technically nothing has changed within the market. For example, discriminative comments by a company’s CEO may result in traders selling their shares.

Hedge finance

A hedge is an investment whereby the related parties look to minimize or offset the risk that the asset will decrease in value. Hedge positions is when you open a two positions on the same asset but in opposite directions.

Hedging 

A trading technique in which the trader opens two trades in opposing directions.

Higher low, higher high 

Higher lows and highs makes reference to technical methodology by which the traders look to ensure that the price waves achieve a continuous higher swing high and higher swing lows.

Hit the bid

To sell an asset at the current market price.

House stats

The number of permits for new houses.

Hyperinflation

Hyperinflation refers to extremely high levels of inflation which are deemed to adversely affect the economy in the longer term.

Illiquid

Reference to minimal volume being traded In the financial trading market; a lack of liquidity often creates difficult market conditions.

IMF

International monetary fund. The idea behind the IMF is to promote economic growth, financial stability around the globe and encourage international trade. The IMF is an international organization.

Implied volatility

The volatility which is currently or believed to soon take place which is not based on past performance or data.

Imports

Imports are goods and services that are bought from outside the economic zone or country.

Indices

Grouped shares traded as one instrument. For example, the S&P 500 is one trading instrument which has grouped 500 US based stocks.

Inflation

The percentage in which goods and services within an economy has risen. Inflation can be viewed positively or negatively depending on the individual viewpoint and rate or change.

Initial jobless claims

The initial Jobless Claims in a U.S. report that measures the number of individuals who filed for state unemployment insurance for the first time over a period of time.

Initial margin 

Also known as required margin. This is the capital required as a minimum to open a trading position in the market. Normally seen on leveraged products.

Initial public offering

Also known as IPO. The process which a private company offers shares to the public via an exchange and/or investment bank.

Insolvency

Similarly, to Bankruptcy, this is another term which refers to when an individual or company is unable to pay his financial obligations.

Interbank market

The interbank market is a global network used by mainly financial institutions to trade currencies and other currency derivatives between each other.

Interbank rates

This is the interest rates which banks charge on the interbank market for short term loans required to meet capital adequacy requirements. Interbank rates can sometimes also be referenced to the exchange rates which large banks charge each other.

Interest rates

The figure charged by banks to the market as well as the percentage that banks charges each other on the interbank market. The Central Bank will also set a rate which is known to be the most influential in the market.

Inventory

Inventory is the term for the goods available for sale and raw materials used to produce goods available for sale.

Investment fund

Investment fund is a broader term for different types of investment whereby individuals come together to form one investment in order to seek better investment opportunities, better management expertise and asset which would not be available.

Investment yield

The income which an individual has received on an investment. For example, this may be dividends or interest.

Japanese candlestick

A form of type which confirms the opening price, closing price, price high and price low.

JMMC

The Joint Ministerial Monitoring committee. The committee is tasked with ensuring that OPEC’s targets are achieved through voluntary adjustments.

Jolt

The job openings and lobour turnover survey. A survey which is done in order to measure Job vacancies in the market.

JPN225

The most popularly traded Japanese index also known as the Nikkei225

Junk Bonds

Junk Bonds are still a form of dept instrument whereby

Keep the power dry

A phrase used by traders referring to limiting trades due to unclear market movements. Due to the nuclear movements, traders hold back waiting for a clear opportunity.

Kickback

An unethical payment in order to receive preferential treatment in the financial trading market.

Kiwi

A nickname for the New Zealand Dollar.

Knocks ins/Outs

A knock in refer to an option which is not available until a specific price is met. A knock out refers to the trade not exiting until again a specific price is met. The action is done automatically once implemented.

KYC

Know your client. A process of formally identifying your client in accordance to local requirements either before or during the time that they start doing business with you. This is normally done via proof of ID and proof of address.

Latency

This refers to the delay between the placement of the trade and the execution of the platform. This is something extremely important to ultra-short term traders and/or at times during high levels of volatility where latency can result in a sizable difference. 

Law of demand 

The law of demand is a theory along with the law of supply that explains how markets’ economies allocate resources and determine the price of goods and services that are tradeable on exchange and in the market.

Leading indicators

Figures and events that are considered to predict future economic activity.

Ledger

A record of total transactions.

Levels

A price zone which is significant for a technical based analysis trader or a trader evaluating orders.

Leverage

Leverage is when the broker increases your buying power resulting in you being able to trade larger sum with only a fraction of the capital required. This increases both potential and risk.

Liability

A trade with a high potential to result in a disadvantageous result.

LIBOR

London Interbank Offered Rate.

Limit order

A pending order which is set to buy when the price drops or sell when the price increases in value.

Line of credit

When a trader has access to present limited borrowing without having to apply for the loaned capital on each occasion. The capital is pre agreed and available to the trader or individual at any time.

Liquid

A market or instrument which allows easy and quick flow of capital.

Liquidation 

Closing one position by opening a new position to offset it.

Loan 

A form of type where an individual or entity borrows capital which is normally repaid with interest.

London session 

08:00 – 17:00 (London time)

Long

Long positions refer to a trade where the investor is speculating the asset will increase in value.

Loonie

The nickname for the Canadian Dollar or USD/CAD currency pair.

Loose money policy

Marketing reference to the central bank attempting to increase the money supply within the economy and promote economic growth or stability.

Lot

A lot references the trade size when trading Foreign exchanges. One lot equals 100,000.

LTV

Loan to value.

Macro

Referring to an extreme long term view on the market and trading anywhere from 6 months to several years.

Macroeconomics

Similar to macroeconomics this also evaluates the market but instead looks mainly at individuals, households and individual business. For example, spending habits can be linked to microeconomics.

Major Currency Pairs

A currency pairs which includes the US Dollar.

Margin 

In economics the margin refers to the difference between the cost of production and the selling price. In forex, the term can represent the amount of capital required to open a position. 

Margin Call

This is a warning that traders receive advising them that the capital in their account has fallen close to the minimum capital requirement. This gives traders time to take action before the minimum is reached. If the minimum is reached, the platform will start to automatically close trades.

Marginal Cost

The additional increase in total cost. When one more unit of output is produced.

Mark to Market

Placing all open positions in a trading account to current market prices.

Market cap

Total Market value of the company’s outstanding shares.

Market Maker

An intermediary continuously quotes bid and ask prices of assets while keeping all trades in house.

Market Order

Enter a trade instantly at the current market price.

Market Risk

Market risk is the risk of financial loss through an investment caused by price movement against the speculate direction.

Maturity

Fixed investments have an end date, maturity is referencing that date of settlement or expiry of a financial product. 

Mean Reversion 

A trading theory which indicates that no matter how the price may move in the short term, in the medium to the longer term the price will return to the mean or average level. These theory concentrates at looking for opportunities via price corrections and pullbacks.

Micro Lot

1/100th of a Lot and represents 1,000 units.

Microeconomics

Similar to macroeconomics this also evaluates the market but instead looks mainly at individuals, households and individual business. For example, spending habits can be linked to microeconomics.

Mini Lot 

One tenth of a lot and represents 10,000 units.

Mining 

Mining is the process where transactions are verified and added to a blockchain.

Momentum 

The speed and strength which the price moves.

Monetary Policy

Actions taken by the country’s central bank through interest rates and supply of capital in the market in order to control inflation and promote a healthy stable economy.

Monetary Policy committee

A Central bank will have a MPC which will analyse the economic requirements and vote on adjecting the policy accordingly. This known to be of high importance within the trading market.

Money Supply

This is the total amount of capital in circulation in the economy during a particular time period. It is considered an important instrument in controlling inflation which is exercised by the Central Bank.

Morning Star

A candlestick which has closed close to its open price after two bearish candlesticks. The idea is that the loss of momentum main indicates a weakness in the downtrend.

Mortgage

A loan secured by a property which I repaid over a long period with interest.

MT4/5

Abbreviation for Metatrader 4 and Metatrader 5 which are both professional trading platforms. Both platforms are known to be the most used in the retail market.

Mutual Fund

A pooled investment whereby the fund looks to mitigate risk across different assets and markets.

NASDAQ

A US index which has grouped 100 US based stocks. Mainly technology stocks.

NDF

Stands for a Non Delivery Forward. A derivative which settles the difference between the contract price and prevailing spot market price at the end of the agreement. 

Negative Gap

When the market opens at a lower price leaving a negative gap in the price.

Negative Yield Curve

Also known as an inverted Yield Curve. This is when short term debt instrument such as Bonds are obtaining higher investment yields than long term instrument. Though it is more common for longer term products to have higher returns.

Net Trade Profit

The capital gained at the end of the investment period or maturity date.

Noise trading

Trading without the use of fundamental data or with minimal date.

Non-Farm Payroll

The total number of paid workers in the US not taking into consideration farming related jobs.

Notional Amount

The total amount of transaction 

NYS

New York Session – 8:00 AM ET and closes at 5:00 Pm ET.

Offer price

Also known as the Ask price. The price in which you are able to buy the product at.

Offset

Referring to when a trader opens a trade in the opposite direction to a previous trade. For example, if you have an open buy trade on the EURUSD but then open a sell on the same asset, this can be referred to as offsetting.

Old lady

Refers to the Bank of England

On Neck

A candlestick trading pattern referred to part of technical analysis. The On neck pattern is formed from two candlesticks, the first is a tall down candle, followed by a much shorter up candle that gaps down on the open but then closes at or near the prior candle’s close.

OPEC

The Organization of the Petroleum Exporting Countries. The Organization includes 13 countries which control the world’s supply of oil.

Options

A derivative product where you are able to trade and speculate the price movement of asset without owning the actual asset.

Order Book

An electronic list of orders for an asset. The order covers both buy and sell orders.

Oscillator

A technical indicator which measures momentum and designed to indicate momentum as well as potentially oversold and overbought prices.

OTC

Over the counter. Referring to investments products which are normally traded via a broker or intermediary.

Overbought

Either bought at a price above its true value or has increased in value faster than its true market value.

Overdraft

An extension of credit from a lending institution or bank that is traditionally regarded in the case that an account reaches zero

Overhead

Another word for expenses which are not directly related to creating a product.

Oversold 

Either sold at a price below its true value or declined at a rate faster than its true market value.

Pair

The value of one currency against another for example, EURUSD.

Parity

When one currency’s value is equal to another. For example, one Euro will buy one USD

Partial Fill

A trade which has not been fully executed due to conditions placed on the trade order or due to market conditions.

Passive Order

When you place an order for the trade to enter at a price different from the Bid and Ask price. The tarde will not enter until the price is met.

Penny Stocks

Stocks being sold on the financial exchange market but are less than $5 and normally refer to small companies. 

Per Capita

Per Capita in economics is referring to economic or statistical converted to per individual.

PIP

The fourth figure after the decimal point. Known to be the movement important point in a currency exchange.

PIPET

The fifth figure after the decimal point.

PMI

Purchasing Managers index is an index which evaluates the business and conditions of the manufacturing and services sectors of the country.

Political risk

Risk to the financial trading market brought about by political events. For example, presidential elections can create unusual volatility and movement in the market.

Position 

Open Trades.

PPI 

A report released by all countries which measures the change in selling prices, or wholesale prices, received by domestic producers for their output. The report is normally produced monthly and can cause high level of volatility.


 Preferred Stocks

Stocks which offer traders dividends as a priority, meaning being paid before common stockholders, also if the company goes into liquidation, preference stock holders again have priority. Preference stockholders do not hold any voting rights.

Premium

The amount in which the price of the stock has increased above its issue price.

Presale

A private sale before the initial coin offering.

Price Action 

Referring to an assets price movement. Price Action analysis refers to analyzing the price without the use of indicators.

Price Ceiling

Equal access to the market for all traders at the same quote price. 

Price Floor

The government imposed minimal for an asset or service. This can include wages and agriculture.

Price Transparency

Equal access to the market for all traders at the same quote price.

Professional Investor

A trader which meet regulatory requirements to be able to trade on higher leveraged products. Professionally classed traders normally have capital requirements placed by the local regulator, such as Cysec.

Profit and Loss Statement

A statement with all trades including positions which resulted in profit as well as losses.

Pullback

A movement in the opposite direction to the trend.

Purchase Power Parity

PPP is a theory that states that the foreign exchange rate between two countries with different currencies should be equal to the ratio between the prices of a fixed basket of goods.

Quantitative Analysis

An analysis of the exchange between two currencies based on statistical figures.

Quantitative Easing

When a central bank injects money into an economy with the aim of stimulating growth.

Quarterly CDFs

A CDF contract which expires every 3 months. The trade will automatically close.

Quote

The figure which the asset is being quoted by the broker.

Quote Currency

The second currency in the currency pair. For example, the US Dollar is the quote currency in the EURUSD.

Rally

A price recovery after a decline.

Range

A price range refers to a period where the price witness little volatility and stays within a define price high and low.

Recession 

When the GDP of a currency has fallen by a minimum of 6 months and is considered as adverse economic conditions.

Reserve Currency

A currency which a bank holds as part of their reserve. The reserve currency is often used for international transactions as well as mitigate currency risk.

Resistance Level

A price level where the asset’s price find resistance and may either lose momentum or possible change direction.

Retail Investor

A trader which is unable to meet professional trading requirements set by the regulator due to net worth and/or experience. This will result in the trader having access to lower levels of leverage. 

Retracements

A small price movement against the trend. Normally caused by traders cashing in profit.

Reversal

A reversal, also known as a price correction, is a turnaround in the price of an asset.

Right Issue

When current shareholders are offered the opportunity to purchase further shares at a discount. Due to the fact the more shares are made available in the market, the more increase chance of the price of the stock to decrease.

Rising Wedge

When the price waves of the asset start wide with high levels of volatility but quickly narrow.

Risk Appetite

The appetite which the market has towards risk.

Risk Aversion

When traders look for investments with more certainty as opposed to high uncertainty. 

Reserve Currency

A currency which a bank holds as part of their reserves. The reserve currency is often used for international transactions as well as mitigate currency risk.

Risk Management

The process and attempt to limit the risk in an investment in accordance to your risk appetite.

Risk on/off

Referring to periods in the market where the risk sentiment is changing between Risk averse to high tolerance.

Risk Sentiment

A term used to describe how participants in the market are behaving and feeling towards investment risk.

ROI

Return in investment.

Rollover

An overnight fee related to a trade. No fee is charged if not kept overnight.

Round Trip

The buying and selling of a specified amount of currency.

Russell 2000 Index

An index composed of 2000 small-cap companies.

Safe Haven Asset

Safe haven assets tend to maintain or appreciate in value during times of uncertainty, though this is not guaranteed.

Safe Haven Currency

A theory that contains currencies that the market deems to most likely retain or increase in value during economic turmoil.

Scalping

 A trading method which is based in ultra-short term positions.

Sell wall

A sell wall is a large order that prevents the market price from going up until the entire sell volume is complete.

Selling Pressure

When a large amount of selling or placing sell orders. The price may not necessarily be dropping yet but it is indicating that the market is expecting a drop.

Sell-off

A situation where a large amount of shareholders sells their shares in a company suddenly causing the price to collapse. Sometimes this can be triggered by bad unexpected news.

Sentimental Analysis

A method which the market may conduct in an attempt to predetermine possible price movements based on the market’s sentiment towards risk, the industry and the instrument class.

Settlement Risk

The possibility of one of the two parties in an investment transaction not been able to fulfil the terms of the position.

Shooting Star

A candlestick within a trend where the price opens higher, trades upwards but then drops back close to the opening price.

Short

Speculating the price will decrease.

Short Squeeze

When there is a high level of demand but a lack of supply resulting in traders trying to hold onto but offset short positions.

Sideways market

A period within a market where the prices are generally moving within a tight price range without any major trends forming.

Slippage

When a trade is open at a price different to the requested price, normally as a result of Ultra high levels of volatility.

Sloggy Price

A period in the market where the price is lacking meaningful trends or price movements.

Social Trading

Social trading refers to when a broker allows traders to interact as well as copy trades of other traders.

Spot

The price of the asset at the exact time of the transaction.

Spread

The different between the bid and ask price.

Stag inflation

Stagflation is known to be an extremely poor condition in the market where the inflation level is high but economic growth and employment is low.

Stamp Duty

Tax on property. Historically this tax has also been used to control growth within the real estate market.

Stop Out

When the margin level in the trades account has reached surpassed the minimum resulting in trades automatically closing.

Sterling

Alternative name for the pound.

Stop Limit Order

A stop order which converts into a limit order after execution.

Stop Loss

An automatic order which closes the trade if the market moves against you by a predetermined level.

Stop Order

A pending order where a long position is placed above the current price or a short position placed below the current offered price.

Support Levels

Prices where the price has historically found support and risen.

Swap

An overnight fee per trade.

Sweeping

Converting your profit and loss into US Dollars at the end of the trading session.

Swing Trading

Swing trading is a medium term trading strategy whereby traders look to trade price swings which last longer than a day but not longer than a week.

Take profit

An order to close the trade when the market is moving in your favor and reaches a certain price. Used to secure profit.

Technical Analysis

An analysis of the price movement, charts and technical indicators.

Technical Indicator

An indicator is inputted onto the chart using mathematical calculations based on the price movement, momentum and historic patterns to give further trading signals to the user.

The January Affect

A theory which states that the first month of the year has a tendency for the stock market to increase in value due to an increase in buying activity.

Thin

When there is little volatility and activity in the market.

Three Black Cows

A candlestick pattern of the three consecutive bearish candlesticks.

Tick

The smallest change in price.

Trade Balance

The difference between imported and exported goods.

Trade Size

The contract size. For example, 1LOT.

Trading Heavy

Used to describe an asset where the price has shown signs of moving lower despite buying attempts.

Trading Volume

Total units being traded.

Trailing Stop

A stop order which is not stationary but is defined by a percentage or amount of the movement in the opposite direction. Therefore, the trade may even be closed in a loss.

Treasury Bills

Short term Government debt instrument with a maturity less than 1 year.

Treasury Bonds

Short Term Government debt instrument with a maturity of 10 years and more.

Treasury Notes

Short Term Government debt instrument with a maturity of less than 10 years but more than 1 year.                             

Trend

The price of the asset moving in one general direction.

Trend Line

Consecutive price highs and lows which form a straight line.

Triple Bottom

The price movement forms three price lows at the same level and then forms a bullish breakout.

Two Way Price

A format where both a buy and sell quote are given.

Underlying Asset

The instrument which the derivative is mimicking.

Unified Managed Account

A privately professional managed account which includes multiple assets under one account.

Unit Investment Trust

A pooled investment which is structured through units and go straight to the individual unit owners instead of reinvesting them back into the fund.

Units 

Units are how instruments are measured. The value of each unit will depend on the instrument.

Unlevered Beta

Removing the financial effects of leverage

Uptick Rule   

Regulation requiring short trades to be opened at a higher price than the previous trade.

Urban Economic Analysis.

When a company or investor first analysis the regional urban issues such as crime, transport, housing and local governance.

US Dollar Index

The US Dollar valued as an index. The currency is valued against six currencies giving traders a stronger and fairer indication of the current price movement.

Value Added

The extras which are given to a product in order for the company to attract customers to buy a product for more than its production cost.

Value Date

The value on the date which the transaction was agreed.

Variation Margin 

Funds that a broker request from a trader in order to have necessary margin deposited to maintain his positions.

VAT

Value added Tax is a type of tax that is levied on the price of certain products and services

Velocity of Money

The measurement of how many times and the rate at which a currency was exchanged. High money velocity is usually associated with a healthy, expanding economy.

Venture Capital

Private funds which are loaned to new companies to assist the startup and early stages of business activites.

Vertical Analysis

Vertical analysis is a method of analyzing investments via financial statements that list each line item as a percentage of a base figure within the statement.

Volatility

The measure of the amount by which the price of an asset or exchange fluctuates.

Volume

The measurement of the quantity of the investment.

VPS

VPS stands for virtual Private server. A program which allows traders to access a remote server. Normally used in order to execute EAs and other trading robots.

Warrant

A derivative where you trade the price of the underlying asset at a fixed price. The products tend to have expiration dates.

Wash Sales

When a trader sells a losing security in order to maximize his tax benefits. This is the clear sole purpose of the transaction.

Wash Trading

Creating volume on your own investment, for example, buying and selling an asset from yourself. You trade with yourself in order to create the illusion of demand and market activity. 

Weak Shorts

A short trade held by a trader which will close the trade at the first signs of the price strengthening.

Wealth

An individual’s capital and possessions.

Welfare

Support which is provided as part of the government fiscal policy in order to endure citizens to meet the minimum society needs such as shelter.

West Texas Intermediate

Also known as WTI, this is a specific class of Oil which is known to have a strong effect on the demand and supply of crude oil prices.

Whipsaw

A term used when the market is seeing high levels of volatility including both a breakout and then a price correction.

Wholesale Price Index

Also known as WPI, an index which tracts the changes in the price of goods and services in the early stages before reaching the retail stage.

Working Capital

The difference between a company’s current assets and current liabilities.

Working Order

A generic term which covers all types of pending order including stop orders and limit orders.

XAG/USD

Symbol for silver index.

XAU/USD

Symbol for Gold index.

XAX.X

Symbol for AMEX composite index.

Yard

One Billion Units.

Year End Bond

A reward paid to an employee at the end of the year.

Yield

Profit which has been made on an investment.

Yield Chasing

When the central Bank in a certain region is suppressing the bank’s interest rates at extremely low or negative levels.

Yield Curve Control

Yield curve control would provide household and businesses with additional accommodation by keeping interest rates not typically set by the Fed low.

Yield Maintenance

Compensation paid to a lender or investor due to loss of interest.

Yield Spread

The difference in the returns between different investments with different maturities, credit rating and risk margin.

Yield to Call

The return the investor receives if he held the bond until the maturity date.

YOY

Year on Year

Zero Coupon Bond

A bond which instead of offering an interest rate, offers its investors a reduced purchase price. No interest is paid.

Zero Lower Bound

When interest rates can’t fall any further below 0%.

ZEW Economic Index

An index conducted within the Eurozone which is based on a survey with major institutional investors and analysts. The index is used to indicate economic health.

ZEW Market Survey

Similar to the Economic index but concentrates mainly on investor sentiment within the market.

ZIRP

Zero interest Rate Policy. When the Central bank has set extremely low interest rates in order to prompt economic growth or inflation.