Glossary
A
A price at which trader are willing to buy contract.
An asset is an economic resource which can be owned or controlled to return a profit, or a future benefit. In financial trading, the term asset relates to what is being exchanged on markets, such as stocks, indices, currencies or commodities.
An asset class is a category of financial instrument – these can be physical assets or financial assets. The instruments are grouped into asset classes based on whether they show similar characteristics, behave in the same way on the market, or are governed by the same laws and regulations.
This is a technical indicator that measures the market volatility over a specified period of time. To calculate, you simply take the average of the difference over a select number of days between the highest price and the lowest price, including any gap.
B
The sum of the cash and any net realised profits or loss on a trading account, based on closed positions/liquidated positions.
This type of chart contains four values of an asset price for each time interval: high, low, opening, and closing prices. High and low prices are reflected by a vertical line, while the opening and closing prices – by horizontal lines. The line on the left of the bar is the opening price, while the line on the right of the bar is the closing price.
The first currency in the currency pair.
A market that’s going down.
A price for which trader is willing to sell contract.
A market that’s going up.
A long position refers to the purchase of an asset, with the expectation that its market value is set to rise.
C
This type of chart shows the opening and closing prices and also the highest and the lowest prices during a period. In case the opening price is higher than the closing price the body of the candle is shaded. In contrast, when the closing price is higher than the opening price, the body is not shaded.
A contract for differences (CFD) is a financial contract that pays the differences in the settlement price between the open and closing trades.
Charts are graphical reflections of price changes of a financial instrument over time.
Commission is the charge levied by a broker for making trades on a trader’s behalf.
A market that’s neither clearly moving up or down.
The standard unit of trading.
Entering a trade when planning/expecting the price to reverse direction.
D
A buy or sell order that expires automatically at the end of the trading day on which it was made.
A type of trading that refers to the fact that trade positions are opened and closed during the same day.
A virtual account gives you the possibility to test the tradingplatform in a simulated environment with virtual money at no risk.
A contract whose value depends upon or is derived from the price of one or more underlying assets, such as securities, futures or other physical instruments.
A strategy for managing risk that involves spreading investments across a number of different assets to reduce overall risk.
A decrease in the price of a security or financial instrument compared to the previous price traded.
E
F
A foreign exchange term describing a situation when you are neither long nor short in a given currency. To be flat, or square, would mean that you have no open positions or all the positions “net” each other out.
An exchange rate where the value of the currency is determined by market forces. Even floating currencies are subject to intervention by the monetary authorities. When such activity is frequent, the float is known as a dirty float.
An interest rate that fluctuates in-line with market conditions over the duration of the loan term. One example of a floating interest rate would be a standard mortgage interest rate, as opposed to a fixed interest rate, which remains constant for the duration of the obligation.
The result from all currently open positions. This is the profit/loss that would be made if the client were to close all their open positions.
Funds available on an account to trade with (not currently being used by open positions).
Analysis based on economic and political data with the goal of determining future movements in a financial market.
The macroeconomic factors that are accepted as forming the foundation for the relative value of a currency; these include inflation, growth, trade balance, trade deficit, and interest rates.
G
A break between prices, when the asset is having a big move up or down without trades occurring.
H
I
In trading, an index is a grouping of financial assets that are used to give a performance indicator of a particular sector. The plural term is indices.
Indices trading is the means by which traders attempt to make a profit from the price movements of indices.
The amount of funds that traders are required to deposit with a broker in order to open a position in a financial market.
Any tradeable financial product such as a currency pair, a CFD or a commodity.
L
The amount of leverage provided by a broker to trade a leveraged product. The amounts typically offered are 5:1, 10:1 and 30:1, 500:1, however the leverage offered will also depend on the trade size of the position.
Also known as “margin trading” is the process in which an investor borrows a significant amount of capital from a broker in order to open a much larger position than the initial margin requirement.
An order that is used to execute a trade at a pre-set price. Limit orders serve the purpose of entering the market at a requested level that is at a more favourable price than the current price, with the trade triggered if the mid-price of the live quote reaches the stipulated level.
As a basic chart type, line charts visualize a trend in data over time intervals by connecting the closing price values straight-line segments.
A live account that gives you the possibility to access and deal in the financial market through your trading platform.
M
This is the minimum deposit that is required and any other additional deposits that may be needed to maintain that position.
A notification from a broker to a trader that additional funds must be deposited into the trader’s account in order to maintain the required margin levels for open positions.
Margin level percentage is a measure of the relationship between the equity in trading account and how much margin is in use. The margin level calculation is expressed as a percentage: (equity / margin) x 100.
Volume of market liquidity that refers to the ability of the market to handle large trading volumes without significantly affecting prices. Market depth is relevant to traders as they can study it to to determine how and when particular orders may impact price action, and to help them find the right timing for entering and exiting trades.
An order that is executed at the current market price, the moment you decide to buy or sell. You will be given the best available price at the time of execution.
The value of a financial asset determined at the current market prices that the client would receive if the position were immediately closed.
A moving average (often shortened to MA) is a common indicator in technical analysis, used to examine price movements of assets while lessening the impact of random price spikes.
N
Net change is the difference between the closing price of the current trading session, compared to the closing price of the previous trading session. Net change can be positive or negative, as it represents whether the markets are up or down on the previous day.
The total value of all open positions combined.
O
A one-cancels-the-other order is a pair of conditional orders stipulating that if one order executes, then the other order is automatically canceled. An OCO order often combines a stop order with a limit order.
The initial trade to enter the market, which involves the buying (long position) or selling (short position) of a financial asset.
An order is a trader’s instruction for the opening or closing of a trade at a particular price level. Orders can be either buy orders (opening of a long position) or sell orders (opening of a short position).
A term used with reference to currency pairs. A currency pair is overbought when its price rises much more quickly than usual in response to net buying. Once overbought, the pair is expected to make a contrarian move (i.e. a fall in its price is to be expected).
A charge implemented by a broker for holding a position open overnight. It is also known as an “overnight finance charge”, and is linked to the interest rate of the underlying currency. Essentially, the charge is an interest payment to cover the cost of the leverage that you use overnight. An overnight charge reflects the cost of borrowing or lending the underlying asset and are charged at LIBOR (or equivalent interest rate). Either a plus or minus percentage is applied (+/- %) on the total value of the position.
The term refers to a condition where an asset has traded lower in price and has the potential for a price bounce.
P
Indicates the value of a position as to whether your position is moving in your favour (profit) or moving in the opposite direction and going against you (loss).
When 1 unit of the base currency in a currency pair is equal to 1 unit of the quote currency.
It is when the trader closes part of an open position.
The smallest move in the quote of a currency pair.
The simultaneous purchase or sale of a basket of securities, combined in a portfolio based on some criteria.
A position is an expression of a trader’s commitment or exposure to the market. A position refers to a trade that has the potential to make either a profit or a loss. Profit or loss on a position can only be realised once it has been closed.
A type of trading during which the trader either buys or sells contracts and holds them for an extended period of time.
Q
The second currency in the currency pair.
The digital cost value of an Asset at a certain point in time.
R
Range is the difference between a market’s highest and lowest price in a given period. It is mostly used as an indicator of volatility: if a market has a wide range, it’s a sign that it was volatile over the period analysed.
A price level above which it is supposedly difficult for a market price to rise.
A function on platform Jetvix that allows a trader to recover their largest initial real deposit up to $500 on their real account.
The identification, analysis and acceptance or offsetting of the risks threatening profitability.
An asset or liability that is exposed to fluctuations in value through changes in exchange rates or interest rates.
The process of extending the settlement date on an open position by rolling it over to the next settlement date.
S
The act of initiating a trade by opening a small position in order to determine whether you should add to it to bring it up to your normal position size.
The act of gradually closing your trade as it moves in your favor or reaches some specified profit objective. It’s the opposite of scaling in, and is especially useful as trades approach resistance levels.
A scalp in trading is the act of opening and then closing a position very quickly, in the hope of profiting from small price movements.
A short position refers to the sale of an asset, with the expectation that its market value is set to fall. It is the opposite of “going long” (buy position).
The difference between the requested market price and the actual price that the trade was filled at. Slippage is based on two factors, liquidity and volatility. It can occur in fast-changing market conditions or in markets where there is a lack of liquidity.
In trading, spot refers to the price of an asset for immediate delivery, or the value of an asset at any exact given time. It differs from an asset’s futures price, which is the price for delivery at some date in the future, or its expected price.
The difference between the buy and sell prices in a market quote.
Stock analysis is the method used by a trader or investor to examine and evaluate the stock market. It is then used to make informed decisions about buying and selling shares. Stock analysis can also be referred to as market analysis, or equity analysis.
A stop loss order is a risk management tool to help protect against large losses if the market moves in the opposite direction of an investor’s trade. It is an order to automatically close a position once it reaches a specific predetermined price pre-set by the investor. A stop loss order will remain active until the order is cancelled or the position is closed.
The automatic closing of a trader’s open positions by a broker to prevent further losses. A stop-out occurs when a trader’s account balance falls below the broker’s margin requirements, typically due to significant losses on open positions.
The term refers to a point in the securities trading below which the price of the security does not fall. Traders determine the support level to time their buying at low prices and earn maximum profits from trading.
The operation of crediting or debiting acertain amount of money from a client’s account when rolling the position over to the next value date (“to the next day”). The size of swap is proportional to the volume of the position and depends on the current difference of interest rates of base and quoted currencies (or assets) in the interbank lending market.
T
A take profit order is a risk management tool allowing a position to be closed automatically, once it reaches a specific pre-set profit goal. This protects against profits being lost in an unanticipated reversal of price direction before the trader can close the position.
A method of financial market analysis that involves the use of charts, graphs and other technical indicators to identify patterns and trends in market behaviour.
Technical indicators are the inseparable part of technical analysis. Their aim is to predict the direction of the market to help a trader. There is a great number of indicators used by traders for determining the market movement. Some traders prefer to use those indicators which have proved to be efficient in trading in the past, while others try using new indicators. Bill Williams’ indicators, Oscillators, Trend and Volume indicators may serve as examples.
The smallest movement possible in the price of a financial instrument.
A quantity of Lots in a Position.
The time period when an Asset is available for opening, closing and modifying Position. Trading Hours for each Asset are stated in its Instrument info section on the Trading Platform.
When a market is making a clear, sustained move upwards or downwards, it is called a trend. Identifying the beginning and end of trends is a key part of market analysis. Trends can apply to individual assets, sectors.
U
An increase in the price of a financial instrument since the preceding transaction. An uptick occurs when a security’s price rises in relation to the last tick or trade.
The amount of margin currently being used for open positions. It is calculated by adding up all of the initial margins of all open positions.
V
A statistical measure of a market or a security’s price movements over time, calculated by using standard deviation. High volatility is associated with a high degree of risk.
In trading, volume is the amount of a particular asset that is being traded over a certain period of time. It is often presented alongside price information, as it offers an extra dimension when examining an asset’s price history.