API Trading

Trades are executed via an automated programming interface (API), allowing orders to be sent directly to the order engine.

The funds available for margin trading, derived from subtracting Used for margin requirements from Account Value.

Automated Forex Trading

A trading system that is automatically executed by computer software without human intervention

Base Currency

First currency in a currency pair (e.g. for GBP/USD, the British Pound is the base currency).In Forex, this is the currency that the investor buys or sells. For example, in EURUSD the base currency is EUR, that means one unit of EUR is worth a variable amount of USD. When you buy EUR, you pay with USD, and when you sell EUR you receive USD. The other currency (USD in the example above) is called the variable currency.

Bear Market

When market prices tend to go lower, the market is said to be a “bear market”. Someone who expects prices to trend lower is “bearish.”A trader who believes that prices will fall. A bearish market is one in which prices are falling, whereas a bear market is when prices have fallen by 20% or more over a sustained period.

Bid

The side of the price quoted where the party quoting the price is interested in buying the base currency of the currency pair.The price at which you can sell a specified instrument. For Forex trading, this is the price at which you can sell the trade/base currency (quoted first) by buying the price currency of the pair. That is, if you sell USDJPY 100,000, you are selling US dollars 100,000 and buying Japanese yen

Broker Program

Introducing Brokers refer clients to forex trading platforms providers, while also expanding the number of products they offer their existing and potential client base. See Introducing Broker.

Bull Market

When prices are rising, the market is said to be a “bull market”; individuals who anticipate higher prices are considered “bulls.” Situations arising which are expected to bring higher prices are called “bullish.”.A trader who believes that prices will rise. A bullish market is one in which prices are rising, whereas a bull market is when prices have risen by 20% or more from a low point over a sustained period.
You can buy or sell a call Option. If you buy a call Option you have the right, but not the obligation to buy the underlying instrument at the agreed strike price on the agreed expiry date (European Option).If you sell a call Option, you have the obligation to sell the underlying instrument at the agreed strike price on the agreed expiry date (European Option).

Charting

When traders analyse the markets, they employ graphs and charts to plot the price movements, volume, open interest, or other statistical indicators of price movement.A chart style where a thin line represents the price range for the instrument in the chart period. The opening and closing prices for the period are represented by a thicker line (red if the price finished lower and green if it finished higher). The overall effect can look like a candle. Many traders believe it is the easiest chart style to read.

First In, First Out (FIFO)

When FIFO logic is adhered to in Forex Trading, offsetting trades in the same currency pair will automatically close the first opened position. For example, if you buy 10 lots and then buy 20 lots of the same currency pair, the first sell in that currency pair will offset the 10 lot position and generate realized PnL based on that position.An order to trade a Forex instrument at a fixed price on a fixed date. The price of the forward outright is the spot rate adjusted for the interest rate differential between the two currencies until maturity. Forward Outright orders are often used to hedge exposure risks when dealing in foreign markets.

Limit Order

An order to open a position or to close an existing positions. A buy limit will be below the current market and a sell limit will be above the current market.. When using a limit order to close an existing position you are establishing your target profit levels.

Limit orders are commonly used to enter a market and to take profit at predefined levels. Limit orders to buy are placed below the current market price and are executed when the ask price hits or breaches the price level specified. (If placed above the current market price, the order is filled instantly at the best available price below or at the limit price.) Limit orders to sell are placed above the current market price, and are executed when the bid price breaches the price level specified. (If placed below the current market price, the order is filled instantly at the best available price above or at the limit price.) When a limit order is triggered, it is filled as soon as possible at the price obtainable on the market. Note that the price at which your order is filled may differ from the price you set for the order if the opening price of the market is better than your limit price. In the case of Futures, the order will be filled if possible, and any remaining volume will remain in the market as a limit order. In the case of CFDs, the order will be filled if possible, and any remaining volume will remain in the market as a limit order.

Liquid Market

A market which allows quick and efficient entry or exit at a price close to the last traded price. The ability to liquidate or establish a position quickly is due to a large number of traders willing to buy and sell.The ability to quickly convert an investment portfolio to cash without suffering a noticeable loss in value.

The capacity to be converted easily and with minimum loss into cash. Ultra-short-dated treasury notes are an example of a liquid investment. A liquid market is one in which there is enough activity to satisfy both buyers and sellers.

Market Order

An order that is immediately executed at the current market price

An order to buy or sell a specified instrument as soon as possible at the price obtainable in the market.

Market Rate

Current quote of a currency pair.

The mid-price is halfway between the bid and the ask (offer) prices. For example, if the bid is 1.4426 and the ask is 1.4430, the mid-price is 1.4428.

Offer

The side of the price quoted where the party quoting the price is interested in selling the base currency of the currency pair.

The price at which you can buy a specified instrument. For Forex trading, it is the price at which you can buy the trade/base currency (quoted first) by selling the price currency of the pair. For example, if you buy EURUSD 100,000, you are buying euros 100,000 against US dollars.

Pip

Percentage in Point. Price change of a currency pair typically measured to one basis point (i.e. 0.0001).

Pip stands for percentage in point , the smallest increment by which a Forex cross price changes. Most currency pairs are quoted to four decimal places, meaning that a movement from 1.1850 to 1.1851 for a currency pair would constitute one pip. For a particular position, you can calculate the value of a single pip using the above formula. For instance, you know that the EUR/USD is quoted with four decimals, so for a given position you can multiply the position amount by the value of one pip, or USD 0.0001. So, on a EUR/USD 100,000 contract, one pip would equal USD 10. On a USD/JPY 100,000 contract, one pip is equal to JPY 1000 because USD/JPY is quoted with only two decimals (meaning one pip = JPY 0.01).

Quote Currency

Second currency in a currency pair (e.g. for GBP/USD, the U.S. Dollar is the quote currency).

The current price offered or asked for a financial instrument.

Rollover

Closing a position for one value date and simultaneously opening the same position for another value date. The rollover price reflects the difference between the interest rate for the two currencies involved in the trade.

When a Spot Forex position is held at the end of the business day prior to its Value date, it will be rolled over to a new value date on a Tom/Next basis. As part of the rollover, positions are subject to a swap charge or credit based on the LIBOR/LIBID interest rates of the two traded currencies with an added a mark-up of +/- 0.25% (for private accounts) plus an interest component for any unrealised profit/loss on the position.

Short

One who has sold a currency pair, A trader with a short position is looking for the price of the base currency to go down.

In Forex trading, going short is to buy the price currency of the Forex currency pair. For example, if you were going short on GBPUSD, you would be buying USD by selling GBP. For equities, going short is selling a security without owning it, as opposed to going long where you are taking ownership of the security by buying it. A short position benefits from a decline in market prices.

Spot

Today’s market price of a currency pair for value in two business days (for most currency pairs).

A direct trade on a market price with a standard settlement date (Value date) of two business days from the trade date.

Spread

The bid-offer spread, which is the difference between buy and sell quotes

The difference between the Bid price at which you can sell the trading instrument and the Ask price at which you can buy the trading instrument.

Stop Order

An order to open a position or to close an existing positions. A stop order to sell will be below the current market and a stop order to buy will be above the current market When using a stop order to close an existing position you are limiting the loss on that position.

Stop orders are commonly used to exit positions and to protect against trading losses. Stop orders to sell are placed below the current market level and are executed when the Bid price hits or breaches the price level specified. Stop orders to buy are placed above the current market level and are executed when the Ask price hits or breaches the price level specified. If the Bid price for sell orders (or the Ask price for buy orders) is hit or breached, the order becomes a market order and is filled as soon as possible at the price obtainable in the market. Note that this price may differ from the price you set for the order. In the case of Futures, the order will be filled if possible, and any remaining volume will remain open as a market order. In the case of CFDs, the order will be filled completely if the volume in the market allows for it. In the case of a partial fill, the remaining portion of the order will remain open as an order.

Trailing Stop

A stop-loss order that changes the order rate with movements in the market. The stop loss trail will specify a number of pips, once the market has moved the specific number of pips the level of the stop loss order will move the specified amount.

A Trailing Stop order is a stop order that has a trigger price that changes with the spot price. As the market rises (for long positions), the stop price rises according to the proportion set by the user, but if the market price falls, the stop price remains unchanged. This type of stop order helps an investor to set a limit on the maximum possible loss without limiting the possible gain on a position. It also reduces the need to constantly monitor the market prices of open positions.

Volatility

A measure of the fluctuation in the market price of a currency pair. Mathematically, volatility is the annualised standard deviation of returns.

here are two types of volatility:

  • Historical volatility is actual volatility based on volatility realised in past movements in the market.
  • Implied volatility is the volatility interpreted from the price of Options. So, the implied volatility is the expected spread of movement of an underlying asset’s price, predicted over the term of the Option, and derived from the known prices of Options and the other parameters used in the calculation of those prices.

 

Created by

Choudhary Nouman Sarwar

Marketing Officer,CEO