Trading
Glossary

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See the meaning of all trading terms in our glossary.

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Account Balance

The total amount of funds available in a trading account

ADX (Average Directional Index)

An indicator measuring the strength of a trend

Alpha

The total amount of funds available in a trading account

Altcoin

Any cryptocurrency that isn’t Bitcoin

Arbitrage

The simultaneous buying and selling of an asset in different markets to profit from price differences

Ask Price

Lowest price at which a seller is willing to sell an asset

Backtesting

Testing a trading strategy on past data to see how it would perform

Bear Market

A market condition where prices are falling or expected to fall

Beta

The total amount of funds available in a trading account

Bid Price

Highest price a buyer is willing to pay for an asset

Bid-Ask Spread

The difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept

Black Swan Event

An unpredictable event with potentially severe consequences

Blockchain

A decentralized ledger technology that records transactions across many computers

Blue-Chip Stock

Shares in a large, well-established company with a solid financial history

Breakout

A price movement through a support or resistance level, signaling a potential new trend

Broker

A person or firm that executes buy and sell orders on behalf of traders

Bull Market

Market condition where prices are rising or expected to rise

Candlestick Chart

A type of price chart used in technical analysis, showing the open, high, low, and close of an asset

Capital Gain

The profit made from selling an asset for more than it was bought

CBOE VIX Index

A key measure of market expectations of near-term volatility based on S&P 500 stock index option prices

CFD (Contract for Difference)

A derivative product where traders speculate on price movements without owning the asset

Circuit Breaker

A mechanism to temporarily halt trading during significant market declines

Commission

The fee charged by a broker for executing trades

Consolidation

A period of sideways price movement where the market is indecisive

Copy Trading

A feature allowing traders to copy trades of more experienced investors

Correction

A short-term drop in stock prices of 10% or more from a recent high

Crypto Market Timings

The trading hours for cryptocurrency markets, which are open 24/7

CTrader

An advanced trading platform with powerful charting and execution features

Currency Trading

The act of buying and selling different currencies

Day Trading

Buying and selling financial instruments within the same trading day

DeFi (Decentralized Finance)

Financial applications built on blockchain that allow peer-to-peer transactions without intermediaries

Demo Account

A trading account that simulates real trading without risking actual money

Derivatives

Financial instruments whose value is derived from an underlying asset

Diversification

Spreading investments across different assets to reduce risk

Dividend

A portion of a company’s earnings paid to shareholders

Dow Jones Industrial Average

An index of 30 large, publicly traded U.S. companies

Drawdown

The peak-to-trough decline in the value of an investment

EPS (Earnings Per Share)

A company’s profit divided by the outstanding shares of its common stock

Equity

The value of an account, including cash and securities

ETF (Exchange-Traded Fund)

A type of investment fund traded on exchanges, holding assets like stocks or commodities

Expiration Date

The date on which an options or futures contract expires

FOMC (Federal Open Market Committee)

U.S. government body that sets monetary policy

Forex (FX)

Foreign exchange market where currencies are traded

Forex Brokers

Companies providing platforms for retail traders to trade forex

Forex Commodity

Commodities like oil and gold that can also be traded in the forex market

Forex Economic Calendar

A calendar listing major economic events that can impact financial markets

Forex Market Holidays

Days when major financial markets are closed

Forex Market Timings India

The hours during which the forex market is open in India

Forex Pip Calculator

A tool to determine the monetary value of a pip for a given trade size

Forex Session Times

Different trading hours for various forex markets, such as London and New York

Forex Swap

The interest fee a broker may charge to hold a position overnight

Forex Times

The operational hours of different forex markets worldwide

Front-Running

A practice where a broker or trader buys or sells a security for their account before executing orders for a client

Fundamental Analysis

Evaluating an asset based on economic indicators and financial statements

Futures Contract

An agreement to buy or sell an asset at a future date at a predetermined price

FX Swap

A currency exchange where two parties exchange currencies and agree to reverse the trade at a future date

Golden Cross

A bullish signal in chart analysis when a short-term moving average crosses above a long-term moving average

Hedging

A strategy used to reduce the risk of adverse price movements in an asset

HFT (High-Frequency Trading)

Algorithmic trading involving the execution of a large number of orders at rapid speeds

ICO (Initial Coin Offering)

A fundraising method where new cryptocurrencies are sold to investors

Index

A measurement of the performance of a group of assets, like the S&P 500

Index Trading

Trading on the price movements of a stock market index like the S&P 500 or Dow Jones

IPO (Initial Public Offering)

The first sale of a company’s stock to the public

Leverage

Borrowing capital to increase the size of your trades

Leverage Trading

Trading with borrowed funds to increase potential returns

Limit Order

Buy or sell an asset at a specific price or better

Liquidity

The ease with which an asset can be bought or sold without affecting its price

Liquidity Pool

A pool of assets used to provide liquidity in decentralized finance (DeFi) or trading environments

Liquidity Provider

A market participant who makes buy and sell orders to ensure a liquid market

Liquidity Risk

The risk that an asset cannot be quickly converted into cash without a loss in value

Long Position

Buying an asset expecting its price to rise

Lot Size

Measurement of quantity in trading, especially in forex, such as micro, mini, or standard

Lot Size Forex

The number of currency units in a forex trade

MACD (Moving Average Convergence Divergence)

A trend-following momentum indicator showing the relationship between two moving averages

Margin

A deposit required to open a leveraged position

Margin Call

A broker’s demand for more funds when a margin account falls below the required level

Market Order

Buy or sell an asset immediately at the current market price

Market Sentiment

The overall attitude of investors toward a particular market or asset

MetaTrader 4 (MT4)

A popular trading platform for forex and CFDs

MetaTrader 5 (MT5)

Advanced version of MT4 with additional features for trading various assets

MetaTrader APK Download

Download file for mobile versions of MT4 and MT5

MetaTrader Download

The process of downloading MT4 or MT5 for forex trading

Mining

The process of validating and recording transactions on the blockchain

Moving Average

A trend-following indicator that smooths out price data by creating a constantly updated average price

My Forex Funds

A company that offers funding for forex traders

New York Session Forex Time

The hours when the New York forex market is open for trading

Options

Contracts that give the buyer the right, but not the obligation, to buy or sell an asset at a specific price

Order Book

List of buy and sell orders for an asset arranged by price

OTC Trading

Trading that occurs directly between two parties, bypassing an exchange

Over-the-Counter (OTC)

Trading of securities outside of formal exchanges, often done directly between two parties

P/E Ratio (Price-to-Earnings)

A ratio used to value a company by comparing its current share price to its earnings per share

Penny Stock

A low-priced, small-cap stock, typically considered highly speculative and risky

Pip

Smallest price movement in currency pairs

Pip Calculator

Tool to calculate the pip value for various currency pairs

Platform

The software or interface used for trading online

Portfolio

A collection of investments owned by an individual or institution

Position Sizing

Determining the amount of money to invest in a particular trade

Proof of Stake (PoS)

A consensus mechanism where participants validate transactions and create new blocks based on the amount of cryptocurrency they hold and are willing to “stake,” offering a more energy-efficient alternative to PoW

Proof of Work (PoW)

A consensus mechanism where participants solve complex mathematical problems to validate transactions and add new blocks

Prop Firms

Companies that fund traders with capital, often offering higher leverage than retail brokers

Prop Trading (Proprietary Trading)

Trading using a firm’s own money in the financial markets rather than client funds

Pump and Dump

A scheme to artificially inflate the price of a stock to sell it at a profit, after which the price crashes

Recovery

A period of increasing prices or economic growth after a decline

Resistance Level

A price level where an asset tends to stop rising and start falling

Risk Management

Strategies to minimize financial loss in trading

ROA (Return on Assets)

A financial ratio indicating the profitability of a company relative to its total assets

ROE (Return on Equity)

A measure of financial performance, calculated by dividing net income by shareholders’ equity

RSI (Relative Strength Index)

A momentum indicator that measures the speed and change of price movements

S&P 500

An index of 500 leading publicly traded companies in the U.S.

S&P 500 VIX Index

A volatility index based on the S&P 500

S&P VIX Index

A real-time market index representing the market’s expectation of 30-day forward-looking volatility

Scalper Trader

A trader who specializes in making small, frequent trades

Scalping

A trading strategy that aims for small profits through quick trades

Scalping Strategy

A fast-paced trading strategy aimed at profiting from small price changes

Short Selling

Selling a security you don’t own, hoping to buy it back at a lower price

Slippage

The difference between the expected price and the actual price of a trade

Slump

A significant decline in an asset’s price or market activity

Smart Contract

A self-executing contract with the terms of the agreement directly written into code

Smart Order Routing

An automated process for finding the best possible prices for orders across multiple venues

Social Trading

A type of trading where investors follow or copy the trades of others

Spread

Difference between the ask and bid price

Spread Betting

Speculating on price movements without owning the asset

Stablecoin

A type of cryptocurrency designed to maintain a stable value, often pegged to a fiat currency

Stochastic Oscillator

A momentum indicator comparing a particular closing price of an asset to a range of its prices over a certain period

Stop Order

An order to buy or sell a security once its price moves past a certain point, triggering a market order

Stop-Loss Order

Sell an asset to prevent further loss when it hits a preset price

Strike Price

The set price at which an options contract can be exercised

Supply and Demand Zones

Price areas where buying or selling pressure is concentrated

Support and Resistance Levels

Important price levels that indicate possible market reversals or breakouts

Support Level

A price level where an asset tends to stop falling and start rising

Swing Trading

A short-term trading strategy where positions are held for several days to weeks

Take-Profit Order

Sell an asset when it reaches a preset profit level

Technical Analysis

Studying past market data, primarily price and volume, to predict future price movements

Tokenization

Converting physical or digital assets into tokens on a blockchain

Top 10 Forex Brokers

The leading forex brokerage firms globally, ranked by various criteria like reputation, service, and fees

Trade Volume

The total number of shares or contracts traded for a particular security

Trading Risk Management

The process of managing financial losses in trading through strategies like position sizing and stop-losses

Trading Strategy

A plan for making trades to achieve financial goals

Tradingview

A web-based charting and trading platform widely used for market analysis

TradingView Paper Trading

A feature that allows users to simulate trading on the TradingView platform without risking real money

Tradingview Subscription

Paid version of the TradingView platform with advanced features and tools

Trailing Stop

A stop order that adjusts as the price of an asset moves in the investor’s favor

Trendline Trading

Using trendlines to determine market direction and place trades

Volatility Index (VIX)

A measure of market volatility, often referred to as the “fear index”

Volatility Trading

A strategy that profits from fluctuations in asset prices

Wallet

A digital tool used to store cryptocurrencies

XAUUSD Market Open Time in India

The opening times for trading gold

Yield

The income return on an investment, often expressed as a percentage

Yield Curve

A graph that shows the relationship between interest rates and the maturity dates of debt securities

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