If you come across any unknown Forex term - our Forex glossary is at your service! Ability to speak on the same language with other traders, understanding important porcesses taking place in the Forex market, rapid study of materials - all this is not all what you can get from the glossary.
The Forex glossary is made is such a way that you can quickly find the meaning of the desired Forex term. Each day the number of unknown words will decrease - these terms will be your natural vocabulary!
Askmeans the higher price in the quotation; the price at which Client can buy.
Balancesum on client's sub-account after conducting a transaction and deposit/withdrawal operations.
Base currencymeans the first currency in a currency pair, which the Client can buy or sell for currency of quotation.
Bidmeans the lower price in the quotation; the price at which Client can sell.
CFD (Contract for difference)is a subject of a trading transaction based on change in base asset's value. This asset can be represented by shares, futures, commodity, precious metal, stock index etc.
Clientis an individual, who concluded Client Agreement with the Company to conduct trades under the terms of marginal trading.
Client terminalis MetaTrader software product used by Client to obtain real-time data on trading on financial markets (in the volume determined by the Company), carry out technical analysis, implement transactions, set/change/cancel orders, as well as to receive information from the Company. Maximum (High) and minimum (Low) prices are used to build price charts in it. The software can be downloaded from the Company’s web-site.
Contracts' specificationare the main trading conditions (trading schedule, spread, lot volume, minimum volume of a transaction, margin, spread, threshold for orders, swap etc.) specified for each financial instrument. Full specifications is represented on the web-site of the Company.
Conversion arbitrage transactionstransactions between the Company and Client on purchase or sale of financial instruments (currency pairs of CFDs)
Currency pairis the object of transaction which is based on change in value of one currency against the other.
Equityis the money funds of Client accounting current loss on open positions and current profit on open positions on a specific account. Equity is calculated as follows: Balance + Floating Profit/Loss + Swap.
Financial instrumentsare the currency pairs and CFD available for trading.
Floating Profit/Lossare the floating profit (loss) on open positions under current quote rates.
Free Marginis the money funds, which do not participate in the margin for current positions and can be used to open new positions. Free margin is calculated as follows: Free Margin = Equity – Margin.
Gapis a situation when current quote differs from the previous one for than spread. It may occur both within a trading session upon release of significant macroeconomic data, economic and political news or under force majeure events and during the market opening after weekend and holidays.
Locked positionsmean long and short positions of the same volume opened on the same trading account with regard to the same instrument.
Long position (Buy)means buying a financial instrument with a view to upsurge in price. As applied to currency pairs: purchase of base currency for quoted currency. As applied to CFD: purchase of base asset of CFD for USD.
Lotis a conditional designation of base currency amount, stock or base asset accepted in trading platform. Number of lots is a measure unit for volume of transaction (example: 1.00 lot = 100 000 units of base currency). Lot volume for each instrument is listed in “Specifications of trading contracts” section of the Company's web-site.
Marginessential money collateral required to open and maintain trading positions. For currency pairs, amount of margin is less than real volume of a trading position in the proportion defined by credit leverage (for example, 1% under the leverage 1:100). As applied to CFDs, margin amount doesn't depend on leverage and is defined in absolute (monetary) or percentage expression from real volume of a trading position (for example, 10% for CFD on metals). Margin for each instrument is defined in the of contract specification on the Company's web-site.
Margin Levelis the key indicator of the account status showing if there is enough funds to maintain open positions. It is calculated as per the formula: Margin level = Equity/Margin *100%. If the margin goes below the level specified by the Regulations of trading operations, Stop Out comes into force.
Margin Tradingtrading transactions with the use of leverage enabling client to make trades with the amounts exceeding his funds by many times.
Non-market quote (Spike)is the quote meeting each of the following requirements: presence of a significant price gap; return of price to its initial level within a short time resulting in a price gap; no rapid price movements prior to its occurrence. The Company has the right to remove off-market quote from the base of quotes on its trading server.
Open positionis the result of the first part of a closed trade for purchase or sale of an instrument, which is not covered by an opposite operation of the same volume (respectively, sell or purchase). In the result of opening a position, Client has the liabilities to maintain margin level not below the value specified in the Regulations of Trading Operations.
Orderis a Client's instruction to the Company to open or close position once prices reaches a certain specified level.
Order levelis the price specified in order.
Quotationis the information on current price represented by Bid and Ask.
RequestClient instruction for obtaining the quote. Request does not mean the responsibility to conduct a trading operation.
Short position (Sell)a position held with the view of decline of asset's value. As applied to currency pairs, it means sales of base currency for quoted currency. As applied to CFDs, it is sale of base asset for USD.
Spreadis the difference between Ask and Bid represented in pips at the present moment.
Stop outis an automatic command of trading server to close positions at current quotes without any prior notification of Client. It occurs if there are not enough funds to maintain open positions on account and margin does not satisfy requirements specified for Margin Level/Stop Out in “Trading conditions” section of the Company's web-site.
Trading accountis a special dedicated personal account opened by Client in the Company to keep tab of liabilities between the Company and Client arisen from trading and non-trading operations made under Client Agreement.
Transactionis the total number of transactions under which funds are converted from base currency to quoted currency and back.
Working hoursis the period of time within a business week, when the Company's trading terminal ensures conducting of trades with currency pairs and CFDs with the exception of holidays, temporary changes in the internal schedule of the Company as well as the time when customer service is impossible because of technical reasons. On these events, the Company is entitled to doing its best to notify Client about change in its working schedule and provide Client with an opportunity to eliminate currency risks arising hereof.