Trading Glossary

This is a non-exhaustive list of trading terms that a trader should know.

A

Alpha – Measure of an investment portfolio’s performance against a benchmark
Ask Price – Price at which you can buy an asset

B

Bid – Price a a party is willing to pay for an asset
BoE – Bank of England, the central bank of the United Kingdom
BoC – Bank of Canada, the central bank of Canada
BoJ – Bank of Japan, the central bank of the Japan
Bull – Someone who thinks the price of an asset will increase in future
Bullish – Description when an asset price is perceived to increase in future
Bear – Someone who think the price of an asset will decrease in future
Bearish – Description when an asset price is perceived to decrease in future

C

Carry – Amount paid to maintain a position. (overnight funding rate, interest rate etc.)
CPI – Consumer Price Index, a measure of inflation
Close – The last traded price of an asset in a given time period
CFD – Contracts for difference, a type of financial derivative on an asset.
Cable – The GBP/USD currency pair
Central bank – The monetary authority of a nation that conducts monetary policy

D

Derivative – Asset that derives its price from another asset (e.g. options, futures, CFDs)

E

Equity – Stocks and shares that carry no fixed interest (The terms stock and equity are used interchangeably)