Arbitrage: The practice of exploiting price differences for the same asset in different markets to make a profit.
Assets: Assets are possessions, tangible or intangible, owned by individuals or entities, with the expectation of future economic benefits.
Asset Classes: A common trading terminology that refers to groups of financial instruments with similar characteristics and behaviors, such as stocks, currencies, or commodities.
Base Currency: In a currency pair, a base currency is the first currency listed, representing the unit against which the exchange rate is quoted in the foreign exchange market (Forex).
Bear Market: A common trading terminology that refers to the state when prices of financial assets consistently fall, indicating a pessimistic market outlook.
Bid: A bid is trading terminology referring to the highest price that a buyer is willing to pay for a financial instrument.
Bonds: Bonds are debt securities issued by governments, municipalities, or corporations to raise capital.
Bull Market: A common trading terminology that refers to the state when prices of financial assets consistently rise, indicating an optimistic market outlook.
Closed Position: A common trading terminology that refers to the situation where an investor has completed the buying or selling of a financial asset, thereby exiting the market for that particular position.
Day Trading: Day trading is a trading terminology that involves buying and selling financial assets within the same day, trying to profit from short-term price movements.
Derivative: A derivative is a financial contract that gets its value from the changes in the price of something else, like stocks, bonds, or commodities.
Equity Market: Another term for the stock market, where shares of companies are bought and sold.
Financial Derivatives: Contracts whose value is derived from the performance of underlying market variables, such as assets, interest rates, or indices.
Fixed Income: A type of investment that pays regular income, such as bonds or preferred stocks.
Forex: Forex, or foreign exchange, involves the trading of currencies in a decentralized global market.
Hedge: Hedging is a common trading terminology that refers to having a financial safety net to protect against potential losses by making smart investments.
High-Frequency Trading: The super-fast buying and selling of assets, often done by computers using algorithms to take advantage of tiny price changes.
Interest Rate: The cost of borrowing money or the return on investment, expressed as a percentage, and it influences various financial markets and economic activities.
Liquidity: Liquidity refers to how easily an asset can be bought or sold in the market without significantly impacting its price.
Market Maker: A financial entity or individual that provides liquidity to markets by continuously buying and selling securities, ensuring smooth trading and narrower bid-ask spreads.
Nasdaq: A global electronic marketplace for buying and selling securities, as well as the name of the index that tracks the performance of the stocks listed on it.
Retention: The practice of keeping a portion of earnings or profits within a company rather than distributing them as dividends.
Securities: Tradable financial assets, such as stocks or bonds, representing ownership in a company or a promise to repay a debt.
Swap: A financial derivative where two parties exchange cash flows or other financial instruments, often used for managing interest rate or currency risks.
Volatility: Volatility measures the degree of variation in the price of a financial instrument over time, indicating the level of risk or uncertainty associated with its price movements.
Stock: A share representing ownership in a company.
Dividend: A portion of a company’s earnings distributed to shareholders.
Leverage: Borrowed funds that amplify trading positions, increasing both potential gains and losses.
Lot: The standard unit size for a forex trade, such as a micro lot (1,000 units) or standard lot (100,000 units).
