Trading Education

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  1. Negative Carry Pair

    A negative carry pair is a forex strategy of holding a long position on low-interest currency and a short position on a high-interest ...
  2. Bear Squeeze

    During a bear squeeze, market conditions force investors to buy back investments at a higher price than they sold for earlier.
  3. Universal Currency Converter

    A universal currency converter is an online application that enables the easy conversion of currency values based on present-day ...
  4. Buy Quote

    Buy quote is one way of describing the best available price to buy a particular security at any given time throughout a trading ...
  5. Gharar

    Gharar is an Arabic word that is associated with uncertainty, deception and risk.
  6. What is the difference between standard deviation and variance?

    Understand the difference between standard deviation and variance; learn how each is calculated and how these concepts are ...
  7. Presidential Election Cycle Theory

    The Presidential Election Cycle Theory states that U.S. stock markets are weakest in the year following the election of a ...
  8. Take A Flier

    Take a Flier refers to the actions of an investor actively engaging in a high risk investment opportunity.
  9. Settlement Price

    A settlement price, in the derivatives markets, is the price used for determining profit or loss for the day, as well as ...
  10. Overnight Limit

    The overnight limit is the number or size of currency positions a trader may carry over from one trading day until the next. ...
  11. Bear Straddle

    A bear straddle is a speculative options trading strategy through buying a short call and put position with the same strike ...
  12. Behavioral Finance

    Behavioral finance is a field of finance that proposes psychology-based theories to explain stock market anomalies.
  13. Specialist Short Sale Ratio

    The specialist short sell ratio compares the short positions held by NYSE specialist firms to those held by the overall market.
  14. Workout Market

    A workout market is a market maker prediction as to the trading price range a security will occupy within a reasonable period ...
  15. Force Index

    The Force Index is a technical measure of the market power behind the movement of a stock's price in a particular period.
  16. Five Hundred Dollar Rule

    The five hundred dollar rule is a regulation that prevents a bank or firm from liquidating a client's account to cover a ...
  17. Bear Position

    Bear position is a term representing a short position applied to a financial security.
  18. Specific-Shares Method

    The specific-shares method is a personal accounting technique designed to minimize tax liability when selling off shares ...
  19. Downside Risk

    Downside risk is an estimate of a security's potential to suffer a drop in value if the market conditions change.
  20. Trading Rut

    A trading rut is a period of investing during which a trader fails to earn profits and instead experiences a string of losses. ...
  21. Active Bond Crowd

    Active bond crowd is a term used to describe frequent traders of active bonds on the New York Stock Exchange.
  22. Buying On Margin

    Buying on margin is the purchase of an asset by paying the margin and borrowing the balance from a bank or broker.
  23. Covered Bear

    A covered bear is a trading strategy in which a short sale is made on a long position involving stock the investor owns. ...
  24. Market Efficiency

    Market efficiency theory states that it is not possible for an investor to outperform the market because there are no under- ...
  25. Price Target

    A price target is the projected price level of a financial security stated by an investment analyst or advisor and includes ...
  26. Cup and Handle

    A cup and handle price pattern on bar charts resembles a cup and handle where the cup is in the shape of a "U" and the handle ...
  27. Technical Skills

    Technical skills are the knowledge and abilities needed to accomplish STEM or computer-related complexities, as well as other ...
  28. Average Daily Trading Volume - ADTV

    The Average Daily Trading Volume (ADTV) is the average amount of individual securities traded in a day or over a specified ...
  29. Liquidation Level

    In forex trading, the liquidation level is the point when the liquidation of the trader's positions is automatically triggered. ...
  30. How to Practice as a Day Trader With Paper Trading

    Day traders face intense competition in today's market. Paper trading practice is more important than ever for getting above-market ...
  31. Countertrend Strategy

    A countertrend strategy attempts to make small gains by trading against the current trend. Traders also refer to the practice ...
  32. Goal-Based Investing: My Favorite Term

    Managing Director of Vanguard's Retail Investor Group Karin Risi shares why "goal-based investing" is her favorite financial ...
  33. Rectangle

    Rectangle is a pattern of securities on a chart.
  34. Aaron's Law

    Aaron’s Law is a bill introduced in Congress in 2013 to reform the Computer Fraud and Abuse Act of 1986 .
  35. Forex Options Trading

    Forex options trading allows currency traders to realize gains or hedge positions of trading without having to purchase the ...
  36. Exchange Rate: My Favorite Term

    What are exchange rates and why are they important to investors and economists?
  37. Dollar Bull

    A dollar bull is an investor or speculator who is optimistic about the outlook for the U.S. dollar against other currencies.
  38. Paper Industry ETF

    The paper industry ETF is an exchange-traded fund that invests primarily in manufacturers of paper and pulp.
  39. Swing Trading

    Swing trading attempts to capture gains in a stock (or any financial instrument) within an overnight hold to several weeks.
  40. Nash Equilibrium

    The Nash Equilibrium is a concept within game theory where the optimal outcome of a game is where there is no incentive to ...
  41. Mean Reversion

    Mean reversion is a financial theory suggesting that asset prices and returns eventually return back to the long-run mean ...
  42. After-Hours Trading

    After-hours trading refers to the buying and selling of securities completed outside of regular trading hours.
  43. Stopped Out

    Stopped out refers to the execution of a stop-loss order, an effective strategy for limiting potential losses.
  44. Plus Tick

    A plus tick is a price designation referring to the trading of a security at a price higher than the previous sale price ...
  45. How Is Par Value Affected When a Bond Price Falls?

    When you buy a bond, the interest payable is known as the par value of the bond. Find out how the par value is affected when ...
  46. Caribbean Community and Common Market (CARICOM)

    The Caribbean Community and Common Market (CARICOM) is a common market comprising of twenty nations and dependencies located ...
  47. How Reddit Makes Money

    Reddit, the self-proclaimed “Front Page of the Internet,” celebrated its tenth anniversary last year. How does the website ...
  48. Significant Order

    A significant order is an order to trade securities that is big enough to affect the security's price.
  49. What AMLO’s Win Means

    Anti-establishment candidate Andrés Manuel López Obrador (AMLO) has won the Mexican election. We share our key views on the ...
  50. Curbs In

    Curbs in is a term used in investing to signify when trading curbs are active.
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Hot Definitions
  1. Current Assets

    Current assets is a balance sheet account that represents the value of all assets that can reasonably expected to be converted ...
  2. Volatility

    Volatility measures how much the price of a security, derivative, or index fluctuates.
  3. Money Market

    The money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities ...
  4. Cost of Debt

    Cost of debt is the effective rate that a company pays on its current debt as part of its capital structure.
  5. Depreciation

    Depreciation is an accounting method of allocating the cost of a tangible asset over its useful life and is used to account ...
  6. Ratio Analysis

    A ratio analysis is a quantitative analysis of information contained in a company’s financial statements.
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