Every industry tends to create its own language, and the foreign exchange market is no exception.
Nowadays, there are more and more foreign exchange terms, and foreign exchange trading is becoming more and more popular. More and more people rush into the foreign exchange market. Understanding each foreign exchange term is a necessary skill for every foreign exchange professional.
As a novice forex trader, you must understand certain terms thoroughly before making your first trade.
Only by mastering these terms can you provide theoretical support for your foreign exchange speculation.
Below, please come together to understand the most complete summary of the trading terms.
Foreign exchange: Foreign exchange is the exchange of one currency into another, that is, the purchase of one currency in a currency mix and the sale of another currency.
The foreign exchange market has no specific location and no central exchange. Instead, currencies are traded through an electronic network of banks, companies and individuals.
The exchange rate of various currencies fluctuates frequently in the international market and is traded in currency pairs, such as euro/dollar or dollar/yen.
Margin: Margin is a performance guarantee, a certificate of holding of a trading order with a certain percentage of capital that must be invested when opening a position. Margin allows investors to hold a position higher than the value of the account.
In Yilong Financial transactions, the margin for all currency pairs is $1000 / hand.
Margin ratio: net value ¡Â used margin = margin ratio. When margin ratio is lower than 30%, the system will force liquidation.
Opening a position: Opening a position, also called opening a position, is a trader to buy or sell a certain amount of gold, silver, crude oil spot contracts.
Open position: The contract that has not been closed after opening a position is called open position or open position, also called open position.
Open interest: Open interest is the total value of a bought (or sold) position before it is closed.
Overnight holding: All overnight holding receipts must be paid at the rate specified in the foreign exchange regulations and displayed in the “Interest” column of “Terminal – Trading” on the trading platform after the settlement time of the next day.
Liquidation: The act of buying back a sold contract or selling a bought contract is called liquidation.
Contract value: The total value of the product bought and sold.
That is, the price of crude oil or silver * the number of hands (quantity).
Long: Long is long, long on the market judgment is up, will immediately buy crude oil or silver, so long is to buy crude oil or silver.
Short: Short is short, short is the market trend judgment is down, the immediate execution of crude oil or silver to sell behavior.
Settlement: refers to the purchase of gold to sell, or the sale of gold back.
Occupation margin (advance payment) : The amount of gold sold or sold by the customer * the proportion of advance payment.
Available advance payment: the total amount of funds deposited by the customer net, after deducting all handling charges, inventory charges and easy to use advance payment incurred by the customer’s trading account, plus the balance of funds after floating profit and loss.
Purchase Price: The price at which the customer buys crude oil from SSP, i.e. the higher price indicated by the quotation system.
Offer price: The price at which the customer sells crude oil to SSP, i.e. the price below the price indicated by the quotation system.
Commission: A fee charged by a broker for a client’s trades, which the broker encourages out of self-interest.
Customer report: A column form that records information related to a customer’s purchase or sale.
Commission fee: The service fee charged by the trading platform for providing customers with trading services.
Position risk rate: (Net value of customer account/margin of occupied position) *100% Net value of customer account: account balance + floating profit and loss.
Consolidation: consolidation refers to the stock price in a period of time, the fluctuation range is small, there is no obvious upward or downward trend, the stock price is cattle leather finishing, to the stage of the market amplitude is small, the direction is not easy to grasp, is the most confused investors.
Current hand: The number of hands in the latest transaction that has been closed.
Position: Net holdings of a given currency.
Positions can be short, long or flat, long (more buying than selling) or short (more selling than buying).
Full position: no money, all buy or sell the contract is full, leave half called half position, fall after buy called cover, from nothing to buy a new position called construction.
Bid price: The highest price a seller can get for a currency at any given time. The difference between the selling price and the buying price is the spread.
In a word, the offer consists of these two prices, but there is a certain difference.
The bid-ask spread in foreign exchange is expressed as a percentage of transaction costs.
Put-call parity: The balance between the price of a call option and a put option at the same expiration date.
Settlement: Settlement refers to the dispute over the allocation of funds such as margin, profit and loss, commission fee and extension fee in accordance with the relevant regulations of the exchange and the trading results of members and users.
The implementation of daily debt-free settlement form, settlement from the floating profit and loss is converted into settlement profit and loss, and generate the actual transfer of funds.
Price range: The difference between the highest and lowest futures prices in a given trading session.
Leveraged trading: As the name implies, it is the use of a small amount of capital to invest several times the original amount, in the expectation of obtaining a multiple of the volatility of the investment subject matter, or a loss.
The risk is high because margin (the small amount of money) does not move in proportion to the volatility of the underlying asset.
Highest price: The highest price traded that day.
Lowest price: The lowest price of the day.
Negative: Factors or news that cause a price drop to be favorable to the bears.
Bullish: is to stimulate the price of the bullish factors and news.
Volume: Reflects the volume of transactions.
The unit is the sum calculated on both sides of the transaction.
Price: The lifting unit of the bid.
The price varies from contract to contract.
Rise and fall: Indicates whether the price of a contract has risen or fallen by comparing the closing price of each day with the previous day’s settlement price.
