- Ask
- The price at which you can buy. Also called the offer. It is always above the bid.
- Base currency
- The first currency in a pair. In EUR/USD, the euro is the base currency.
- Bear market
- A sustained period of falling prices, often defined as a fall of 20% or more from a recent high.
- Bid
- The price at which you can sell. It is always below the ask.
- Blockchain
- A shared, append-only record of transactions maintained by many independent computers. See crypto guide.
- Bull market
- A sustained period of rising prices.
- Candlestick
- A chart bar showing the open, high, low and close for a period. See candlestick charts.
- CFD
- Contract for difference: a derivative that pays the change in an asset's price without owning it. See CFDs explained.
- Commission
- A fee charged per trade, often per lot per side in forex.
- Cross pair
- A currency pair that does not include the US dollar, such as EUR/GBP.
- Custody
- Who holds an asset or the keys to it. With crypto, custodial means a company holds your keys.
- Derivative
- A contract whose value depends on another asset, such as a future, option or CFD.
- Dividend
- A payment of company profits to shareholders. Never guaranteed.
- Drawdown
- The fall in an account or asset from a peak to a subsequent low, usually shown as a percentage.
- Equity
- In trading, your account balance plus or minus open profits and losses.
- ETF
- Exchange-traded fund: a fund that holds a basket of assets and trades on a stock exchange like a share.
- Exotic pair
- A major currency paired with a smaller or emerging market currency, usually with wider spreads.
- Futures contract
- An exchange-traded agreement to buy or sell an asset at a set price on a future date.
- Gap
- A jump in price between one trade and the next, often over a weekend or after news.
- Halving
- The roughly four-yearly cut in Bitcoin's mining reward. See Bitcoin explained.
- Hedging
- Taking a position to offset the risk of another position.
- Index
- A measure of the performance of a group of assets, such as the S&P 500.
- Leverage
- Controlling a position larger than your deposit. 30:1 means $1 of margin supports $30 of exposure.
- Limit order
- An order to buy or sell only at a set price or better.
- Liquidity
- How easily an asset can be bought or sold without moving its price much.
- Long
- A position that profits if the price rises.
- Lot
- A standard position size. One standard forex lot is 100,000 units of the base currency. See pips and lots.
- Major pair
- One of the most traded currency pairs, each including the US dollar.
- Margin
- The deposit required to open and hold a leveraged position. See margin calculator.
- Margin call
- A warning that your equity is close to the level at which positions will be closed.
- Market order
- An order to buy or sell immediately at the best available price.
- Negative balance protection
- A rule that stops retail clients losing more than the money in their account.
- Pip
- The standard unit of price movement in forex: 0.0001 for most pairs, 0.01 for yen pairs. See pip calculator.
- Private key
- The secret that controls a crypto address. Whoever holds it can move the funds.
- Quote currency
- The second currency in a pair. In EUR/USD, the US dollar is the quote currency.
- Recovery phrase
- A list of 12 or 24 words that backs up a crypto wallet's keys. Never share it with anyone.
- Risk-reward ratio
- The potential loss on a trade compared with its potential gain.
- Short
- A position that profits if the price falls.
- Slippage
- The difference between the expected price of an order and the price at which it is filled.
- Spread
- The gap between the bid and ask prices, paid on every trade. See trading fees.
- Stablecoin
- A crypto token designed to hold a fixed value, usually one US dollar. See USDT explained.
- Stop-loss
- An order that closes a position at a set price to limit the loss.
- Swap
- An overnight financing charge or credit on a leveraged position.
- Take-profit
- An order that closes a position when it reaches a set profit level.
- Volatility
- How much and how quickly a price moves. Higher volatility means larger swings in both directions.
- XAU/USD
- The price of one troy ounce of gold in US dollars. See gold trading.