Yard
Slang for a billion.
Showing posts with label Glossary. Show all posts
Showing posts with label Glossary. Show all posts
Sunday, December 26, 2010
Forex Glossary- W
Whipsaw
Slang for a condition of a highly volatile forex market where a sharp price movement is quickly followed by a sharp reversal.
Slang for a condition of a highly volatile forex market where a sharp price movement is quickly followed by a sharp reversal.
Forex Glossary - V
Value Date
The date on which counterparts to a financial transaction agree to settle their respective obligations, i.e., exchanging payments. For spot currency transactions, the value date is normally two business days forward. Also known as maturity date.
Variation Margin
Funds a forex broker must request from the client to have the required margin deposited. The term usually refers to additional funds that must be deposited as a result of unfavorable price movements.
Volatility (Vol)
A statistical measure of a forex market's price movements over time.
Volatility (Vol)
A statistical measure of a forex market's price movements over time.
The date on which counterparts to a financial transaction agree to settle their respective obligations, i.e., exchanging payments. For spot currency transactions, the value date is normally two business days forward. Also known as maturity date.
Variation Margin
Funds a forex broker must request from the client to have the required margin deposited. The term usually refers to additional funds that must be deposited as a result of unfavorable price movements.
Volatility (Vol)
A statistical measure of a forex market's price movements over time.
Volatility (Vol)
A statistical measure of a forex market's price movements over time.
Forex Glossary - U
Unrealized Gain/Loss
The theoretical gain or loss on Open Positions valued at current market rates, as determined by the broker in its sole discretion. Unrealized Gains' Losses become Profits/Losses when position is closed.
Uptick
A new price quote at a price higher than the preceding quote.
Uptick Rule
In the U.S., a regulation whereby a security may not be sold short unless the last forex trade prior to the short sale was at a price lower than the price at which the short sale is executed.
US Prime Rate
The interest rate at which US banks will lend to their prime corporate customers.
The theoretical gain or loss on Open Positions valued at current market rates, as determined by the broker in its sole discretion. Unrealized Gains' Losses become Profits/Losses when position is closed.
Uptick
A new price quote at a price higher than the preceding quote.
Uptick Rule
In the U.S., a regulation whereby a security may not be sold short unless the last forex trade prior to the short sale was at a price lower than the price at which the short sale is executed.
US Prime Rate
The interest rate at which US banks will lend to their prime corporate customers.
Forex Glossary - T
Technical Analysis
An effort to forecast prices by analyzing market data, i.e. historical price trends and averages, volumes, open interest, etc.
Tick
A minimum change in price, up or down.
Tomorrow Next (Tom/Next)
Simultaneous buying and selling of a currency for delivery the following day.
Transaction Cost
The cost of buying or selling a forex financial instrument.
Transaction Date
The date on which a forex trade occurs.
Turnover
The total money value of all executed transactions in a given time period; volume.
Two-Way Price
When both a bid and offer rate is quoted for a forex transaction.
An effort to forecast prices by analyzing market data, i.e. historical price trends and averages, volumes, open interest, etc.
Tick
A minimum change in price, up or down.
Tomorrow Next (Tom/Next)
Simultaneous buying and selling of a currency for delivery the following day.
Transaction Cost
The cost of buying or selling a forex financial instrument.
Transaction Date
The date on which a forex trade occurs.
Turnover
The total money value of all executed transactions in a given time period; volume.
Two-Way Price
When both a bid and offer rate is quoted for a forex transaction.
Forex Glossary - S
Settlement
The forex process by which a trade is entered into the books and records of the counterparts to a transaction. The settlement of currency trades may or may not involve the actual physical exchange of one currency for another.
Short Position
An investment position that benefits from a decline in market price. When the base currency in the pair is sold, the position is said to be short.
Spot Price
The current forex market price. Settlement of spot transactions usually occurs within two business days.
Spread
The difference between the bid and offer prices.
Square
Purchase and sales are in balance and thus the dealer has no open position.
Sterling
slang for British Pound.
Stop Loss Order
Order type whereby an open position is automatically liquidated at a specific price. Often used to minimize exposure to losses if the market moves against an investor's position. As an example, if an investor is long USD at 156.27, they might wish to put in a stop loss order for 155.49, which would limit losses should the dollar depreciate, possibly below 155.49
Support Levels
A technique used in forex technical analysis that indicates a specific price ceiling and floor at which a given exchange rate will automatically correct itself. Opposite of resistance.
Swap
A currency swap is the simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate.
Swissy
Market slang for Swiss Franc.
The forex process by which a trade is entered into the books and records of the counterparts to a transaction. The settlement of currency trades may or may not involve the actual physical exchange of one currency for another.
Short Position
An investment position that benefits from a decline in market price. When the base currency in the pair is sold, the position is said to be short.
Spot Price
The current forex market price. Settlement of spot transactions usually occurs within two business days.
Spread
The difference between the bid and offer prices.
Square
Purchase and sales are in balance and thus the dealer has no open position.
Sterling
slang for British Pound.
Stop Loss Order
Order type whereby an open position is automatically liquidated at a specific price. Often used to minimize exposure to losses if the market moves against an investor's position. As an example, if an investor is long USD at 156.27, they might wish to put in a stop loss order for 155.49, which would limit losses should the dollar depreciate, possibly below 155.49
Support Levels
A technique used in forex technical analysis that indicates a specific price ceiling and floor at which a given exchange rate will automatically correct itself. Opposite of resistance.
Swap
A currency swap is the simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate.
Swissy
Market slang for Swiss Franc.
Forex Glossary - R
Rally
A recovery in price after a period of decline.
Range
The difference between the highest and lowest forex price of a future recorded during a given forex trading session.
Rate
The price of one currency in terms of another, typically used for dealing purposes.
Resistance
A term used in technical analysis indicating a specific price level at which analysis concludes people will sell.
Revaluation
An increase in the exchange rate for a currency as a result of central bank intervention. Opposite of Devaluation.
Risk
Exposure to uncertain change, most often used with a negative connotation of adverse change.
Risk Management
the employment of financial analysis and trading techniques to reduce and/or control exposure to various types of risk.
Roll-Over
Process whereby the settlement of a forex deal is rolled forward to another value date. The cost of this process is based on the interest rate differential of the two currencies.
Round trip
Buying and selling of a specified amount of currency.
A recovery in price after a period of decline.
Range
The difference between the highest and lowest forex price of a future recorded during a given forex trading session.
Rate
The price of one currency in terms of another, typically used for dealing purposes.
Resistance
A term used in technical analysis indicating a specific price level at which analysis concludes people will sell.
Revaluation
An increase in the exchange rate for a currency as a result of central bank intervention. Opposite of Devaluation.
Risk
Exposure to uncertain change, most often used with a negative connotation of adverse change.
Risk Management
the employment of financial analysis and trading techniques to reduce and/or control exposure to various types of risk.
Roll-Over
Process whereby the settlement of a forex deal is rolled forward to another value date. The cost of this process is based on the interest rate differential of the two currencies.
Round trip
Buying and selling of a specified amount of currency.
Forex Glossary - Q
Quote
An indicative forex market price, normally used for information purposes only.
An indicative forex market price, normally used for information purposes only.
Forex Glossary - P
Pips
The smallest unit of price for any foreign currency. Digits added to or subtracted from the fourth decimal place, i.e. 0.0001. Also called Points or Forex Pips.
Political Risk
Exposure to changes in governmental policy which will have an adverse effect on an investor's position.
Position
The netted total holdings of a given currency.
Premium
In the currency markets, describes the amount by which the forward or futures price exceed the spot price.
Price Transparency
Describes quotes to which every forex market participant has equal access.
Profit /Loss or "P/L"
The actual "realized" gain or loss resulting fromtrading activities on Closed Positions, plus the theoretical "unrealized" gain or loss on Open Positions that have been Mark-to-Market.
The smallest unit of price for any foreign currency. Digits added to or subtracted from the fourth decimal place, i.e. 0.0001. Also called Points or Forex Pips.
Political Risk
Exposure to changes in governmental policy which will have an adverse effect on an investor's position.
Position
The netted total holdings of a given currency.
Premium
In the currency markets, describes the amount by which the forward or futures price exceed the spot price.
Price Transparency
Describes quotes to which every forex market participant has equal access.
Profit /Loss or "P/L"
The actual "realized" gain or loss resulting fromtrading activities on Closed Positions, plus the theoretical "unrealized" gain or loss on Open Positions that have been Mark-to-Market.
Forex Glossary - O
Offer (ask)
The rate at which a dealer is willing to sell a currency. See Ask (offer) price.
Offsetting transaction
A trade with which serves to cancel or offset some or all of the forex market risk of an open position.
One Cancels the Other Order (OCO)
A designation for two orders whereby one part of the two orders is executed the other is automatically cancelled.
Open order
An order that will be executed when a forex market moves to its designated price. Normally associated with Good 'til Cancelled Orders.
Open position
An active trade with corresponding unrealized P&L, which has not been offset by an equal and opposite deal.
Over the Counter (OTC)
Used to describe any transaction that is not conducted over an exchange.
Overnight Position
A trade that remains open until the next business day.
Order
An instruction to execute a trade at a specified rate.
The rate at which a dealer is willing to sell a currency. See Ask (offer) price.
Offsetting transaction
A trade with which serves to cancel or offset some or all of the forex market risk of an open position.
One Cancels the Other Order (OCO)
A designation for two orders whereby one part of the two orders is executed the other is automatically cancelled.
Open order
An order that will be executed when a forex market moves to its designated price. Normally associated with Good 'til Cancelled Orders.
Open position
An active trade with corresponding unrealized P&L, which has not been offset by an equal and opposite deal.
Over the Counter (OTC)
Used to describe any transaction that is not conducted over an exchange.
Overnight Position
A trade that remains open until the next business day.
Order
An instruction to execute a trade at a specified rate.
Forex Glossary - N
Net Position
The amount of currency bought or sold which have not yet been offset by opposite transactions.
The amount of currency bought or sold which have not yet been offset by opposite transactions.
Thursday, December 23, 2010
Forex Glossary - M
Margin
The required equity that an investor must deposit to collateralize a position.
Margin Call
A request from a broker or dealer for additional funds or other collateral to guarantee performance on a position that has moved against the customer.
Market Maker
A forex dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument.
Market Risk
Exposure to changes in forex market prices.
Mark-to-Market
Process of re-evaluating all open positions with the current market prices. These new values then determine margin requirements.
Maturity
The date for settlement or expiry of a financial instrument.
The required equity that an investor must deposit to collateralize a position.
Margin Call
A request from a broker or dealer for additional funds or other collateral to guarantee performance on a position that has moved against the customer.
Market Maker
A forex dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument.
Market Risk
Exposure to changes in forex market prices.
Mark-to-Market
Process of re-evaluating all open positions with the current market prices. These new values then determine margin requirements.
Maturity
The date for settlement or expiry of a financial instrument.
Forex Glossary - L
Leading Indicators
Statistics that are considered to predict future economic activity.
Leverage
Also called margin. The ratio of the amount used in a forex transaction to the required security deposit.
LIBOR
The London Inter-Bank Offered Rate. Banks use LIBOR when borrowing from another bank.
Limit order
An order with restrictions on the maximum price to be paid or the minimum price to be received. As an example, if the current price of USD/YEN is 117.00/05, then a limit order to buy USD would be at a price below 102. (ie 116.50)
Liquidation
The closing of an existing position through the execution of an offsetting transaction.
Liquidity
The ability of a forex market to accept large transaction with minimal to no impact on price stability.
Long position
A position that appreciates in value if market prices increase. When the base currency in the pair is bought, the position is said to be long.
Lot
A unit to measure the amount of the deal. The value of the deal always corresponds to an integer number of lots.
Statistics that are considered to predict future economic activity.
Leverage
Also called margin. The ratio of the amount used in a forex transaction to the required security deposit.
LIBOR
The London Inter-Bank Offered Rate. Banks use LIBOR when borrowing from another bank.
Limit order
An order with restrictions on the maximum price to be paid or the minimum price to be received. As an example, if the current price of USD/YEN is 117.00/05, then a limit order to buy USD would be at a price below 102. (ie 116.50)
Liquidation
The closing of an existing position through the execution of an offsetting transaction.
Liquidity
The ability of a forex market to accept large transaction with minimal to no impact on price stability.
Long position
A position that appreciates in value if market prices increase. When the base currency in the pair is bought, the position is said to be long.
Lot
A unit to measure the amount of the deal. The value of the deal always corresponds to an integer number of lots.
Forex Glossary - I
Inflation
An economic condition whereby prices for consumer goods rise, eroding purchasing power.
Initial Margin
The initial deposit of collateral required to enter into a position as a guarantee on future performance.
Interbank Rates
The Foreign Exchange (forex) rates at which large international banks quote other large international banks.
Intervention
Action by a central bank to effect the value of its currency by entering the market. Concerted intervention refers to action by a number of central banks to control exchange rates.
An economic condition whereby prices for consumer goods rise, eroding purchasing power.
Initial Margin
The initial deposit of collateral required to enter into a position as a guarantee on future performance.
Interbank Rates
The Foreign Exchange (forex) rates at which large international banks quote other large international banks.
Intervention
Action by a central bank to effect the value of its currency by entering the market. Concerted intervention refers to action by a number of central banks to control exchange rates.
Forex Glossary - H
Hedge
A position or combination of positions that reduces the risk of your forex primary position.
"Hit the bid"
Acceptance of purchasing at the offer or selling at the bid.
A position or combination of positions that reduces the risk of your forex primary position.
"Hit the bid"
Acceptance of purchasing at the offer or selling at the bid.
Forex Glossary - G
G7
The seven leading industrial countries, being US , Germany, Japan, France, UK, Canada, Italy.
Gap
Gaps are areas on a chart where the price of a stock (or another financial instrument) moves sharply up or down with little or no trading in between. As a result, the asset's chart shows a "gap" in the normal price pattern. The enterprising trader can interpret and exploit these gaps for profit. Here we'll help you understand how and why gaps occur, and how you can use them to make profitable trades.
Going Long
The purchase of a stock, commodity, or currency for investment or speculation.
Going Short
The selling of a currency or instrument not owned by the forex seller.
Gross Domestic Product
Total value of a country's output, income or expenditure produced within the country's physical borders.
Gross National Product
Gross domestic product plus income earned from investment or work abroad.
Good 'Til Cancelled Order (GTC)
An order to buy or sell at a specified price. This order remains open until filled or until the forex client cancels.
The seven leading industrial countries, being US , Germany, Japan, France, UK, Canada, Italy.
Gap
Gaps are areas on a chart where the price of a stock (or another financial instrument) moves sharply up or down with little or no trading in between. As a result, the asset's chart shows a "gap" in the normal price pattern. The enterprising trader can interpret and exploit these gaps for profit. Here we'll help you understand how and why gaps occur, and how you can use them to make profitable trades.
Going Long
The purchase of a stock, commodity, or currency for investment or speculation.
Going Short
The selling of a currency or instrument not owned by the forex seller.
Gross Domestic Product
Total value of a country's output, income or expenditure produced within the country's physical borders.
Gross National Product
Gross domestic product plus income earned from investment or work abroad.
Good 'Til Cancelled Order (GTC)
An order to buy or sell at a specified price. This order remains open until filled or until the forex client cancels.
Forex Glossary - F
Federal Deposit Insurance Corporation (FDIC)
The regulatory agency responsible for administering bank depository insurance in the US.
Federal Reserve (Fed)
The Central Bank for the United States.
First In First Out (FIFO)
Open forex positions are closed according to the FIFO accounting rule. All positions opened within a particular currency pair are liquidated in the order in which they were originally opened.
Flat/square
Fore dealer jargon used to describe a position that has been completely reversed, e.g. you bought $500,000 then sold $500,000, thereby creating a neutral (flat) position.
Foreign Exchange
(Forex, FX) - the simultaneous buying of one currency and selling of another.
Forward
The pre-specified exchange rate for a foreign exchange contract settling at some agreed future date, based upon the interest rate differential between the two currencies involved.
Forward Points
The pips added to or subtracted from the current exchange rate to calculate a forward price.
Fundamental Analysis
Forex analysis of economic and political information with the objective of determining future movements in a financial market.
Futures Contract
An obligation to exchange a good or instrument at a set price on a future date. The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange- Traded Contacts - ETC), versus forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.
The regulatory agency responsible for administering bank depository insurance in the US.
Federal Reserve (Fed)
The Central Bank for the United States.
First In First Out (FIFO)
Open forex positions are closed according to the FIFO accounting rule. All positions opened within a particular currency pair are liquidated in the order in which they were originally opened.
Flat/square
Fore dealer jargon used to describe a position that has been completely reversed, e.g. you bought $500,000 then sold $500,000, thereby creating a neutral (flat) position.
Foreign Exchange
(Forex, FX) - the simultaneous buying of one currency and selling of another.
Forward
The pre-specified exchange rate for a foreign exchange contract settling at some agreed future date, based upon the interest rate differential between the two currencies involved.
Forward Points
The pips added to or subtracted from the current exchange rate to calculate a forward price.
Fundamental Analysis
Forex analysis of economic and political information with the objective of determining future movements in a financial market.
Futures Contract
An obligation to exchange a good or instrument at a set price on a future date. The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange- Traded Contacts - ETC), versus forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.
Forex Glossary - E
Economic Indicator
A government issued statistic that indicates current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.
End Of Day Order (EOD)
An order to buy or sell at a specified forex price. This order remains open until the end of the trading day which is typically 5PM ET.
European Monetary Union (EMU)
The principal goal of the EMU is to establish a single European currency called the Euro, which will officially replace the national currencies of the member EU countries in 2002. On January 1, 1999 the transitional phase to introduce the Euro began. The Euro now exists as a banking currency and paper financial transactions and foreign exchange are made in Euros. This transition period will last for three years, at which time Euro notes an coins will enter circulation. On July 1, 2002, only Euros will be legal tender for EMU participants, the national currencies of the member countries will cease to exist. The current members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal.
EURO
The currency of the European Monetary Union (EMU). A replacement for the European Currency Unit (ECU).
European Central Bank (ECB)
The Central Bank for the new European Monetary Union.
A government issued statistic that indicates current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.
End Of Day Order (EOD)
An order to buy or sell at a specified forex price. This order remains open until the end of the trading day which is typically 5PM ET.
European Monetary Union (EMU)
The principal goal of the EMU is to establish a single European currency called the Euro, which will officially replace the national currencies of the member EU countries in 2002. On January 1, 1999 the transitional phase to introduce the Euro began. The Euro now exists as a banking currency and paper financial transactions and foreign exchange are made in Euros. This transition period will last for three years, at which time Euro notes an coins will enter circulation. On July 1, 2002, only Euros will be legal tender for EMU participants, the national currencies of the member countries will cease to exist. The current members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal.
EURO
The currency of the European Monetary Union (EMU). A replacement for the European Currency Unit (ECU).
European Central Bank (ECB)
The Central Bank for the new European Monetary Union.
Wednesday, December 22, 2010
Forex Glossary - D
Day Trader
Speculators who take positions in commodities which are then liquidated prior to the close of the same forex trading day.
Dealer
An individual or firm that acts as a principal or counterpart to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. In contrast, a broker is an individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission.
Deficit
A negative balance of forex trade or payments.
Delivery
An FX (forex) trade where both sides make and take actual delivery of the currencies traded.
Depreciation
A fall in the value of a currency due to market forces.
Derivative
A contract that changes in value in relation to the price movements of a related or underlying security, future or other physical instrument. An option is the most common derivative instrument.
Devaluation
The deliberate downward adjustment of a currency's price, normally by official announcement.
Speculators who take positions in commodities which are then liquidated prior to the close of the same forex trading day.
Dealer
An individual or firm that acts as a principal or counterpart to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. In contrast, a broker is an individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission.
Deficit
A negative balance of forex trade or payments.
Delivery
An FX (forex) trade where both sides make and take actual delivery of the currencies traded.
Depreciation
A fall in the value of a currency due to market forces.
Derivative
A contract that changes in value in relation to the price movements of a related or underlying security, future or other physical instrument. An option is the most common derivative instrument.
Devaluation
The deliberate downward adjustment of a currency's price, normally by official announcement.
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