Below is a glossary of terms that are used in the online trading industry. Select the first letter of the word you are seeking from the list above to jump to the appropriate section of the glossary.
The amount of money in an account at the start of a business day, including all deposits, withdrawals and/or other cash and cash equivalents (= credits minus debits). If a trader has decided to close an open position, the account balance will be changed in accordance to his/her profit or loss amount.
The interest accumulated on a security from premiums and discounts that relate directly to deposit swap (interest arbitrage) deals over the period of each deal.
A market-wide movement or trend that affects nearly all stocks and sectors. The term originates from the big board used historically in the NYSE for marking price movements.
A market in which a lot of buying and selling is going on.
A market in which prices are generally rising. Also referred to as a Bull Market.
Trading of a company’s stock after the market has closed.
What is an Aftermarket report?
An Aftermarket report is the initial report released by a company after it has begun trading on the public stock exchange. Typically, before a company begins trading on the stock exchange, an investment bank evaluates the company’s worth, and determines how to break down that value in shares that will be sold to the public. After an initial sale of shares to large investors, known as the primary market. Once the primary market sales have been made, the company is able to be traded on a major stock exchange, such as the New York Stock Exchange (NYSE) or NASDAQ. This happens when some of the initial investors decide to sell some (or all) of their stock shares, and any investor of any size can purchase them.
Once the offerings appear on the secondary market, the company releases an Aftermarket report, providing the name of the company, its ticker symbol, the offer date, and offer and closing prices. Often, Aftermarket reports will provide additional information, including financial data and ratios and a description of the company.
How does one use an Aftermarket report?
Aftermarket reports are extremely helpful for investors to gauge an initial public interest in a newly traded company. While it does not guarantee how the company’s market value will move in the future, it does give investors and traders a reasonable idea of what to look for, and whether or not the purchasing of shares early on would be a wise investment. CFD traders can invest on how they believe the market price will react in the days immediately following an Aftermarket report.
What is an all-time high?
The all-time high is the highest price any given asset has ever reached on the open market.
How does one use an all-time high?
An asset reaching a new ATH can provide both opportunities and pitfalls for traders. If the asset is reaching a new ATH on a regular basis, traders can recognize the upward trend, and invest accordingly. However, a strong technical and fundamental analysis is also necessary in order to determine when the asset price will hit its resistance and begin to drop again. An all-time high should not, in and of itself be used to develop a trading strategy, but it can – and should be – one of several tools taken into account.
The annual rate of return on an investment. For example, a £10,000 investment at 5% per year earns £500 a year and has an APR of 5%. Also referred to as the annual percentage rate or simply APR.
Effecting sales and purchases simultaneously in the same or related securities in order to take advantage of price differentials between markets.
During the summer, starts at 00:00 GMT and lasts to 9:00 GMT and during the winter starts at 23:00 GMT and lasts to 08:00 GMT. Also known as the Tokyo trading session.
In the over-the-counter market, the term “ask” refers to the lowest price at which a broker is willing to sell a security (e.g. currency, stock, index or commodity) at any given time. The ask price, also known as the “offer” price, will almost always be higher than the “bid” price (= the highest price a broker is willing to pay to buy a security at any given time). Brokerage firms typically make money on the difference between the bid price and the ask price. This difference is called the “ask-bid spread.”
The official code for the Australian dollar.
A nickname for the Australian dollar.