Anonymous TradingTraders can opt not to disclose their identity while making offers or bids on the financial markets.
AppreciationThe increase in monetary value of any financial instrument in response to the market.
ArbitrageThe simultaneous purchase and sale of an asset in order to increase profits with minimal risks.
Ask RateThe lowest price a seller is willing to sell a financial asset, also known as an offer.
AssetThe instrument that a contract is based upon. This could be a stock, bond, or commodity.
Asset LocationAn investment strategy that aims to balance risk and reward by distribute a portfolio's assest according to a trader's goals and risk tolerance.
At the MoneyThis term refers to a trade breaking even, meaing their neither a profit or a loss.
Attorney in ChargeAn individual authorized to make transactions on the financial markets on behalf of the trader.
AussieA slang term for the AUD/USD currency pair.
Authorized DealerA certified entity that engages in foreign currency transactions.
Away from the MarketAn expression used when a buy or sell price deviates from the assets market price.
Balance of Payments (BOP)A record that tracks a country's transactions over a particular period of time.
Balance of TradeThe difference in value between a country's imports and exports over a particular period of time.
Bank RateThe interest rate that the central bank of a country gives loans to domestic comercial banks.
Bar ChartsA common diagram used to study the price action of currency pairs.
Base CurrencyA term used in trading Foreign Exchange. When quoting currency pairs, it is the first currency that you trade the secondary/quoted currency against. Example: EUR/USD - the Euro is the base currency, and the US Dollar is the quote currency.
BearAn investor who believes that the price of a particular asset will fall and attempts to profit from a decline in stock prices.
Bear MarketThe financial market in which asset prices are falling, encouraging selling.
BidThe selling price of a specific financial asset.
Big FigureThe first two to three digits of a Foreign Exchange rate or price.
Blue ChipShares of well-established companies, considered to be a reliable investment.
Break EvenThis is when there is no profit or loss experienced when making a transaction.
Bretton Woods AgreementAn agreement for an international monetary system. This agrement was signed in 1944 in the United States.
British PoundA slang term for the Currency of the United Kingdom, short for the Sterling Pound.
BrokerA person who buys and sells financial assets as a middleman between retail traders and established financial corporations.
BullAn investor who believes that the price of a particular asset rise fall and attempts to profit from an increase in stock prices.
Bull MarketThe financial market in which asset prices are rising, encouraging buying.
Buy Limit OrderAn order to buy a security at or below a specified price.
CableA slang term in Forex trading for the currency pair GBP/USD (British Pound vs. US Dollar).
Call OptionAn agreement that allows a buyer the option to buy a financial asset at a specified price with in a particular period of time. The buyer however is not obligated to purchase the asset.
CCICCI stands for Commodity Channel Index. This is a technical trading tool regularly used to measure when a financial instrument has been overbought or oversold.
CFDCFD stands for Contract for Difference. This is a contract between an investor and an investment instituation. At the end of the contract, the parties involved exchange the monetary difference between the opening and closing prices of the financial instrument involved in the contract.
CommissionA fee paid to the brokerage firm that facilitated a transaction.
CommoditiesThis refers to raw materials including precious metals, oil, and coffee.
Commodity PairsThe foreign exchange pairs that are highly correlated to commodity fluctuations in the global financial markets. These three pairs are USD/CAD, AUD/USD, and NZD/USD.
CorrelationA statistical term for establishing a relationship between two or more independent assets.
Counter CurrencyA term used in trading Foreign Exchange. When quoting currency pairs, it is the second currency that you compare against the base currency.
CPICPI stands for Consumer Price Index. A statistical measurement that examines changes in the purchasing power of a currency and the inflation rate.
Cross Currency TransactionA transaction that involves two or more currencies being traded at the same time.
CurrencyA financial asset that can be traded, often in pairs.
Currency TradingThe exchange of one currency for another currency.
DAXGermany's leading stock index is called Deutsche Atkien Xchange, or DAX for short.
Day TradingThis is when positions on the market are opened and closed on the same day, rather than holding the positions overnight.
Dealing DeskThis is where a dealer facilitates transactions.
DeficitThis occurs when liabilities (losses) exceed assets (profits).
Demo TraderAn account that uses virtual money, allowing a potential investor to get acclimated to trading in the market before investing real money.
DepreciationThe decrease in monetary value of any financial instrument in response to the market.
Depth of MarketThe volume of open buy and sell orders for a particular currency pair at a particular point in time.
DerivativeA financial contract with a value deriving from an underlying variable asset.
DividendA portion of a company's profits paid to shareholders on a regular schedule.
Earnings Per Share (EPS)The portion of a company's profits allocated to each share of common stock.
ECN BrokerECN stands for Electronic Communication Networks. An ECN Broker is a financial expert that uses ECN's to allow clients direct access to the markets.
European Central Bank (ECB)The European Central Bank is responsible for the monetary policy of countries that have adopted the Euro as their currency.
ExoticExotic currencies are those that are less traded than the major currencies.
Expert AdvisorAn automated trading robot within the trading platform that allows the analytical and trading processes to be carried out with limited manual control.
Expiry TimeThe date and time when a trade involving a financial instrument expires.
Federal ReserveThe central bank of the United States, responsible for overseeing the financial system of the country. This is the leading financial instituation in the world.
FibonacciA common technical tool used by analysts to identify potential levels of support and resistance based on key numbers.
FillThe act of executing a transaction on a trading platform.
Financial InstrumentThe asset that is used in a trade. This could be a stock, bond, or commodity.
FlatThis describes a situation when a trader does not have any running positions in the market.
ForexA slang term for Foreign Exchange.
Fundamental AnalysisA method of market analysis used to evaluate related economic, financial and other qualitative and quantitative factors that affect the performance of a particular financial instrument.
GapThe difference in value between the closing price of one trading period and the opening price of the following trading period.
GDPGDP stands for Gross Domestic Product. It determines the total worth of a country's services and produced goods with in a particular time period, and is used to gauge the economic standing of a country.
GTCGTC stands for Good Till Cancelled. This is an order to buy or sell a specific financial asset at a specific price, that is only valid until a trader chooses to cancel it.
HedgingA strategy used in order to reduce risk of losses when trading in the financial markets.
In the MoneyA phrase to describe a trader making a profit.
IndexA weighted average of preselected stock prices that is used to measure a section of the stock market. Some popular indices are the NASDAQ, Dow Jones, and S&P 500.
InflationA progressive increase in prices of goods and services within a country, which in turn reduces the purchasing value of that country's currency.
Initial MarginThe first deposit a customer makes, which then determines their maximum trade size.
Initial Margin RequirementThe minimum amount for a deposit to enter a trade position.
Interbank RateThe interest rate on loans that one bank will offer to another bank.
Interest RateThe fee paid for borrowing money. Interest rates fluxate as they are affected by Central Banks and inflation.
Introducing BrokerA broker with a direct relationship with the client, but delegates the transactions and trades to another broker.
Japanese YenThe currency in Japan.
JobberA term used for a trader who intends to make accumulated profits by opening and closing short-term positions.
KillAn order that cannot be wholly filled in the market will be cancelled or killed.
KiwiA slang term for the New Zealand Dollar.
Lagging IndicatorsStatistics that change after trends in the economy have already started to change.
Leading IndicatorsStatistics that help forecast a country's economic performance trends.
LeverageA financial tool that allows an investor to magnify their market exposure beyond their initial capital.
Limit OrderA direction to buy or sell an asset a specified price or better.
Line ChartA series of lines connecting multiple price levels over a particular time period.
LiquidityThe degree to which an asset can be bought or sold without affecting it's price.
LongOpening a buy position in the market is referred to as "going long"
LotThe standard number of units required to trade a financial asset, as determined by the exchange.
MarginThe size of deposit needed to ensure the running positions in the market are kept active.
Margin AccountAn account provided by brokers that allows investors to buy securities borrowed funds.
Margin CallThe requirement made by a broker that a trader makes an additional deposit to cover possible losses.
Market MakerA brokerage firm that buys and sells financial assets to provide liquidity to the markets.
Market PriceThe current price of a financial asset being traded in the market.
Market RiskThe potential risk of loss when investing in a specific asset.
Maximum LeverageThe largest amount of leverage available on the initial deposit.
MetaTrader4The innovative trading platform used to provide brokerage services to traders in multiple financial assets.
Mine and YoursTerms used to describe the intention to buy or sell. "Mine" is used when buying, and "yours" is used when selling.
Monetary PoilicyThe policy regarding interest rates and money supply put in place by the central bank of a particular country.
Money MarketA segment of the financial market involving transactions of financial assets with fast maturities and high liquidity.
Moving Acerage Convergence Divergence (MACD)A technical indicator used to determine the trend of the market.
Moving AverageA technical indicator used to filter out the abnormalities to allow the focus to be on the statistical average of the original curve.
NASDAQThe largest electronic stock exchange in the United States.
Net PositionThe value of a position after subtracting the price of the initial investment.
News TraderA trader who bases investment decisions on how global news announcements impact the markets.
NFPStands for Non Farm Payroll. A monthly report done by the United States Department of Labor, which is used to determine the status of the labor market, excluding farmers.
NoiseAbnormalities in the market that make it difficult to focus on the statistical averages used to make a trading decision.
NOKThe currency symbol for the Norwegian Krone.
NYSENew York Stock Exchange.
NZDThe currency symbol for the New Zealand Dollar.
OfferThe price set by a seller at which they are willing to sell.
One Cancels the Other Order (OCO)Two transactions sunmitted at the same time, where the completion of one automatically cancels the other.
Open OrderA position that is running in the market until the trader chooses to close it.
OptionsThe opportunity, but not the obligation, to perform a transaction involving an asset.
OrderA request to a broker to perform a transaction of a financial instrument at a present price.
OscillatorsTechnical analysis tools using an indicator that fluctuates between overbought and oversold levels, used to express buy and sell signals.
Out of the MoneyA term used to describe a loss in trade.
Overnight PositionA position that is kept open until the following trading day.
OvertradingThe risky habit of engaging in excessive trading transactions without appropriate research.
PayoutThe total amount of earnings from a successful transaction.
PIPStands for Percentage In Point. The smallest unit of measurement used in Forex trading to determine exchange rates between multiple currencies.
PlatformThe system used to perform transactions provided by a brokerage firm.
Price.Earnings Ratio (P/E)The ratio used to value a company by comparing it's current share price to it's per share earnings.
Principal ValueThe starting capital that a trader invests for transactions in the financial market.
Pump and DumpThe process of inflating an assets value by purchasing a large quantity in the hopes that others will follow suit. Afterwords, the initial buyer will sell their assets in the hopes to make a profit from the inflated price.
Put OptionAn agreement that allows a seller the option to sell a financial asset at a specified price with in a particular period of time. The seller however is not obligated to sell the asset.
Quantitative EasingA method used by central banks to encourage economic growth. This is done by purchasing government securities in order to increase capital and liquidity in financial institutions.
QuoteThe most recent price a buyer and seller have agreed upon.
Quote CurrencyA term used in trading Foreign Exchange. When quoting currency pairs, it is the second currency that you trade against the first currency.
RateA rate/exchange rate is the compared price of one currency to another.
RebateThe portion of interest or dividends on an asset that is returned to the investor at the end of a trade.
Relative Strength Index (RSI)A technical indicator that measures if a financial instrument has been overbought or oversold.
ResistanceThe price at which a financial asset peaks, before multiple investors decide to sell the asset.
Risk CapitalThe size of a deposit that an investor is willing to risk.
Risk ManagementOne or more strategies used in order to reduce financial risk when trading in the financial markets.
RobotSoftware that indicates when to open or close a position in the market.
RolloverThe act of swaping a matured contract prior to it's expiration date, with a new contract. The difference in price between the two contracts is adjusted.
ScalpingA strategy used by traders who make many small short-term transactions, looking to increase their profits with multiple small increments that can compound.
SECStands for the US Securities and Exchange Commission.
SecurityAny financial asset that can be traded.
Security Exchange Commission (SEC)U.S. government agency that regulates national securities industry, stock markets, and electronic securities agency.
Sell Limit OrderThe process of limiting the price on a transaction.
Sell StopAn order for a limit order to become a market order once it falls below the current market price.
ShortOpening a buy position in the market is referred to as "going long"
Short PositionSelling first and buying later to produce a profit or loss from the difference.
SlippageThe price difference between an assets displayed value and the exact value when a transaction occurs.
SpotTaking the value of the current date and selling at that price, but settling in the following two days.
Spot PriceThe current price an asset can be bought or sold in the marketplace.
SpreadThe difference in value between the ask price and the bid price of a financial asset.
SterlingA name for the British Pound (GBP), also called the pound sterling.
StochasticAn oscillating indicator used to determine the change in price of a financial asset from one closing period to the next.
StockA share in the ownership of a company and the respective assets and earnings.
Stop Loss OrderAn order given by a broker to limit an investor's loss by making them sell when a security reaches a certain price.
Stop-BuyAn order to buy when the currency price is above the current market.
Strike PriceAn asset's value when it is purchased or sold.
SWAPThe process of exchanging value of one investor's assets with another investor's assets.
Take ProfitA type of limit order that determines the specific price to close an open position in order to profit.
Technical AnalysisStudying past market data to influence future of financial instruments.
TraderA person who invests in transactions on the markets.
Trading PlatformsA software used by investors to trade forex.
Trailing Stop LossThe ability to automatically adjust the limit price threshold to be closer to a more favorable market price.
TransactionThe process of exchanging goods, services, and financial assets between a buyer and a seller.
Transaction DateThe moment when trading assets occurs.
TrendThe general direction of the market.
Under-ValuationIf an exchange rate does not surpass it's purchasing power, it is considered undervalued.
Unemployment RateThe rate of people in the workforce without jobs.
US DollarThe currency in the United States of America.
Value DateThe final settlement date decided by the parties involved in a financial deal.
Variation MarginThe extra amount of money needed to constitute for losses when a broker's balance falls beneath the required minimum.
VolatilityThe measurement used to describe the fluctuation of the price of a financial instrument over a specific amount of time.
WhipsawA sharp price movement being trailed by a sharp repeal.
Wire TransferThe process of transferring money electronically from one financial institution to another.
World Bank GroupA support organization that offers its' technical and financial advice to developing countries worldwide.
XDepicting a mutual fund, this is a NASDAQ stock symbol.
XAGThe currency symbol for the precious metal silver. Silver can be used in financial exchanges and typically maintains a high price.
XAUThe currency symbol for gold.
XAU/USDThe gold (XAU) to U.S. dollar (USD) exchange rate can be monitored online and is consistently changing.
XEStands for Xpress Engine. A prominant financial site that provides helpful tools for traders.
Yield CurveThe use of a graph to exhibit the correlation between interest rate and the maturity of the debt asset for a trader.
ZARThe currency symbol for the South African Rand.
Zero-BoundWhen interest rates nearly reach zero percent making it challenging for central banks to measure the expansion of the economy.