Glossary

Một bảng chú giải thuật ngữ chính xác về các thuật ngữ giao dịch, đóng vai trò là tài liệu tham khảo cần thiết để tìm hiểu sự phức tạp của thị trường giao dịch.

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ASIC 

Australian Securities and Investments Commission, regulator in Australia. 

More Information: 
https://oxsecurities.com/about-us/legal-documents/ 

Alpha 

A measure of performance on a risk-adjusted basis. Alpha takes the volatility (price risk) of a mutual fund and compares its risk-adjusted performance to a benchmark index. The excess return of the fund relative to the return of the benchmark index is a fund’s alpha. 

Alpha is one of five technical risk ratios; the others are beta, standard deviation, R-squared, and the Sharpe ratio. These are all statistical measurements used in modern portfolio theory (MPT). All these indicators are intended to help investors determine the risk-reward profile of a mutual fund. Simply stated, alpha is often considered to represent the value that a portfolio manager adds to or subtracts from a fund’s return. 

A positive alpha of 1.0 means the fund has outperformed its benchmark index by 1%. Correspondingly, a similar negative alpha would indicate an under performance of 1%. 

Ask 

The lowest price at which a seller is willing to sell an investment or asset at a given moment. Also known as the offer price. 

More Information: 

https://oxsecurities.com/trading-accounts/spreads/ 

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Base Currency 

The first currency quoted in a currency pair on forex. It is also typically considered the domestic currency or accounting currency. For accounting purposes, a firm may use the base currency to represent all profits and losses.  It is sometimes referred to as the “primary currency”. 

For example, if you were looking at the CAD/USD currency pair, the Canadian dollar would be the base currency and the U.S. dollar would be the quote currency. The price represents how much of the quote currency is needed for you to get one unit of the base currency. 

More Information: 
https://oxsecurities.com/metatrader-cfd/forex-cfds/ 
https://oxsecurities.com/product-schedule/  

Basis Point 

A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. The basis point is commonly used for calculating changes in interest rates, equity indexes and the yield of a fixed-income security. 

The relationship between percentage changes and basis points can be summarized as follows: 1% change = 100 basis points, and 0.01% = 1 basis point. So, a bond whose yield increases from 5% to 5.5% is said to increase by 50 basis points; or interest rates that have risen 1% are said to have increased by 100 basis points. 

Beta 

A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market. Beta is used in the capital asset pricing model (CAPM), a model that calculates the expected return of an asset based on its beta and expected market returns. Also known as “beta coefficient.” 

Beta is calculated using regression analysis, and you can think of beta as the tendency of a security’s returns to respond to swings in the market. A beta of 1 indicates that the security’s price will move with the market. A beta of less than 1 means that the security will be less volatile than the market. A beta of greater than 1 indicates that the security’s price will be more volatile than the market. For example, if a stock’s beta is 1.2, it’s theoretically 20% more volatile than the market. 

Many utilities stocks have a beta of less than 1. Conversely, most high-tech, Nasdaq-based stocks have a beta of greater than 1, offering the possibility of a higher rate of return, but also posing more risk. 

BCB 

Banco Central do Brasil (BCB), the central bank agency of Brazil.  

BOC 

Bank of Canada, the central bank agency of Canada.  

BOE 

Bank of England, the central bank agency of the United Kingdom. 

BOJ 

Bank of Japan, the central bank agency of Japan. 

Bitcoin  

The original cryptocurrency, Bitcoin was created in 2008 using a new technology called Blockchain. This digital currency used encryption techniques to regulate the generation of units of currency and verify the transfer of funds, operating independently of a Central Bank or equivalent government agency.   

More Information: 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/product-schedule/ 

Bitcoin Cash 

Bitcoin cash is a cryptocurrency (“fork”) of the original Bitcoin. It is the split of the Bitcoin transaction ledger, also known as the Blockchain. This was launched in August 2017 and operates under a set of different rules. Bitcoin Cash effectively increased the size of blocks (from 1mb to 8mb), allowing for more transactions to be processed. ​  

More Information: 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/product-schedule/ 

Bid 

The highest price a buyer is willing to pay for a product is referred to as the ‘bid’. X 

More Information: 
https://oxsecurities.com/trading-accounts/spreads/ 

Blockchain 

A digital ledger in which transactions made in cryptocurrencies or digital assets are recorded chronologically and publicly. The decentralized, distributed, and public ledger is spread across many computers so that records cannot be altered retroactively. The inedible record cannot be changed, and the authenticity can be verified by the entire community using the blockchain. It was originally developed as the accounting method for the first digital currency Bitcoin.  

More Information: 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/product-schedule/ 

Bull Market 

A market distinguished by rising prices. Bullish investors have a positive opinion about a market, believing that prices will continue to rise. 

Buy Limit Entry Order 

An order to open a buy position only at the designated price or lower. X 

Buy Stop Entry Order 

An order to open a buy position only at the designated price or higher.  

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Cable 

A term referring to the GBP/USD exchange rate: the rate was originally transmitted between the London and New York exchanges via the transatlantic telegraph cable beginning in the mid-1800s, hence the name. 

Carry Trade 

A strategy in which a trader sells a certain currency with a low interest rate and uses the funds to purchase a different currency yielding a higher interest rate, attempting to capture the difference between the rates. Common low yielding currencies include the USD and JYP and common high yielding currencies include the AUD and NZD. 

Cash Market 

The actual, underlying market on which derivatives contracts are based. 

Central Bank 

A government or quasi-governmental organisation that manages a country’s monetary policy. 

  • Australia: Reserve Bank of Australia 
  • Singapore: Monetary Authority of Singapore 
  • UK: Bank of England 
  • US: Federal Reserve 

Circus Swap 

A combination of an interest rate swap and a currency swap in which a fixed-rate loan in one currency is swapped for a floating-rate loan in another currency. A circus swap therefore converts not just the basis of the interest rate liability, but also the currency of this liability. The floating rate in a circus swap is generally indexed to U.S. dollar LIBOR. The term is derived from the acronym CIRCUS, which stands for Combined Interest Rate and Currency Swap. Also known as a “cross-currency swap” or “currency coupon swap”. 

Companies and institutions use circus swaps to hedge currency and interest rate risk, and to match cash flows from assets and liabilities. They are ideal for hedging loan transactions since the swap terms can be tailored to perfectly match the underlying loan parameters. 

As an example, consider Euromax, a European company that has a US$100 million loan with a floating interest rate (LIBOR + 2%) on its books. The company is concerned that U.S. interest rates may begin to rise, which would lead to a stronger U.S. dollar against the euro, making it more expensive to make future interest and principal repayments. Euromax would therefore like to swap into a fixed-rate loan in Japanese yen, because interest rates in Japan are low and it believes the yen may depreciate against the euro. It therefore enters into a circus swap with a counterparty that converts its U.S. dollar floating-rate debt into a fixed-rate loan in Japanese yen. If the company’s views on future interest rates and currencies are correct, it can save a few million dollars on servicing its debt obligations over the loan’s term. 

Contract for Differences (CFD) 

A CFD is an arrangement made in a futures contract whereby differences in settlement are made through cash payments, rather than by the delivery of physical goods or securities.  

More Information: 
https://oxsecurities.com/metatrader-cfd/forex-cfds/ 
https://oxsecurities.com/metatrader-cfd/indices-cfds/ 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/metatrader-cfd/commodities-cfds/ 
https://oxsecurities.com/iress-share-cfd/shares-cfds/ 
https://oxsecurities.com/product-schedule/  

Corporate Action 

Any event initiated by a corporation which impacts its shareholders. For some events, shareholders may or must respond to the corporate action or select from a list of possible actions. Examples of corporate actions include dividend payments, mergers, rights issues, and stock splits.  

Cross Currency 

A pair of currencies traded in forex that do not include the US dollar, for example EUR/JPY. 

More Information: 
https://oxsecurities.com/trading-accounts/spreads/ 
https://oxsecurities.com/metatrader-cfd/forex-cfds/  

CySEC 

The Cyprus Securities and Exchange Commission, the financial regulatory agency in Cypus.  

 

Currency Pair 

 

All forex trades involve the simultaneous buying of one currency and selling of another, but the currency pair itself can be thought of as a single unit, an instrument that is bought or sold. If you buy a currency pair, you buy the base currency and sell the quote currency. The bid (buy price) represents how much of the quote currency is needed for you to get one unit of the base currency. Conversely, when you sell the currency pair, you sell the base currency and receive the quote currency. The ask (sell price) for the currency pair represents how much you will get in the quote currency for selling one unit of base currency. 

More Information: 
https://oxsecurities.com/trading-accounts/spreads/ 
https://oxsecurities.com/metatrader-cfd/forex-cfds/ 

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Dealing Desk 

An execution model where you trade directly with the broker. The broker becomes your direct counterparty for all trades. 

Digital Wallet 

A digital wallet that stores public and private keys for cryptocurrencies, which acts as a personal ledger of transactions while sending and/or receiving coins. ​ 

Dove / Dovish 

The opposite of hawk, a dove refers to an economic policy advisor supporting monetary policies with lower interest rates as a means of encouraging economic growth. 

DFSA 

Dubai Financial Services Authority, the financial regulatory agency of the special economic zone, the Dubai International Financial Centre.  

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ECB 

European Central Bank (ECB), the central bank agency of the European Union (EU).  

Electronic Currency Network (ECN) 

ECN is an electronic system that widely disseminates orders entered by market makers to third parties and permits the orders to be executed against in whole or in part. 

Ether / Ethereum  

A digital or virtual currency that is open-source, public, blockchain-based distributed computing platform and operating system featuring smart contract (scripting) functionality.  

More Information: 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/product-schedule/ 

ESMA 

European Securities and Markets Authority, the financial regulator in the European Union (EU).  

Executing Broker 

The broker or dealer that finalizes and processes an order on behalf of a client. The orders sent to executing brokers are assessed for appropriateness, and if the order is deemed practical, the executing broker will then carry out the order. If the order is rejected, the customer is notified, and the stock is not traded. 

Once the executing broker has assessed the validity of the order, it is then submitted onto the clearing broker who clears the trade. However, since executing brokers are paid through commission, the possibility exists that this incentive may encourage numerous trades even though they may not be suitable. 

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FCA 

Financial Conduct Authority, the financial regulator in the United Kingdom.  

Fill / Filled 

The execution of an order. 

FMA 

Financial Markets Authority, the financial regulator in New Zealand.  

Federal Reserve System 

The central bank agency/system of the USA.  

Flexible Spread 

The difference between the bid and offer price that a broker can adjust according to market conditions. Also known as dynamic spread, floating spread, or variable spread. 

Forex (FX) 

FX is the market in which currencies are traded. There is no central marketplace for currency exchange; trade is conducted OTC. 

More Information: 
https://oxsecurities.com/metatrader-cfd/forex-cfds/ 
https://oxsecurities.com/product-schedule/ 

Forward 

A contract which locks in the price at which you can ‘buy’ or ‘sell’ an asset (such as a currency pair or commodity) on a future date. 

Fork / Forking 

When the code, encryption or software behind a virtual currency change significantly (typically for improvement reasons), then the original virtual currency splits. An example of this is Bitcoin Cash.  

Fundamental Analysis 

This involves analysing and valuing financial assets based on factors such as news, financial statements and earnings forecasts, company strategy and risk assessments, demand and supply forecasts, projections of future economic growth, industry developments and government policy. 

In fundamental analysis, an investor uses real data to evaluate a stock’s value rather than using charts and technical analysis to make trading decisions. 

Future /  Futures 

A futures contract is a legal agreement, generally made on the trading floor of a futures exchange, to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future. 

Futures are like forwards; except that futures are traded on exchanges, making them standardized contracts. 

A futures CFD will automatically expire at a specified time in the future, whereas a spot or cash CFD has no such expiry time. Often the price of a future contract will differ from the cash price.  

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Gap / Gapping 

The phenomenon of a market trading at a price away from the previous traded price without trades occurring at intervening prices; it more usually, but not necessarily, relates to when a market resume trading after a period of closure.  

Gearing 

Gearing is a measure of leverage used, usually expressed as a percentage. 

A highly leveraged trade would require a small initial outlay in comparison to the notional value of the trade and can be seen as high risk. Small price movements create amplified gains or losses, and therefore losses can exceed deposits made. 

Good For the Day (GFD) Order 

AGFD order remains active in the market until the end of the trading day. 

Good ‘Till Cancelled (GTC) Order 

A GTC order remains active in the market until you decide to cancel it. Your broker will not cancel the order at any time. 

Government Bonds 

Debt security issued by the government. 

Greenback 

A slang term for the US dollar. 

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Hawk / Hawkish 

An economic policy advisor who favours relatively higher interest rates to keep inflation under control or curb rapid economic growth. 

Hedge / Hedging 

A way of reducing the risk of losses that may occur if interest rates, share prices or foreign exchange rates move in the wrong direction. This usually involves the use of CFD or futures contracts. 

In trading, hedging also refers to simultaneously buying and selling the same instrument. 

Holding Cost (Swap) 

The cost of holding a position during a certain time (usually overnight). 

 

High Water Mark  

The highest peak in value than an investment fund or account has reached. The high-water mark ensures the manager does not get compensated large sums for poor performance.  

Hurdle Rate 

In hedge funds, the hurdle rate refers to the rate of return that the fund manager must beat before collecting incentive fees. 

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ICO 

Intial Coin Offering, an IPO for cryptocurrencies as a method to raise funds. It is also where people can first buy the corresponding token or crypto currency. 

Illiquid Market 

A market with relatively less aggregate volume in the order book. In an illiquid market, a small amount of business often moves prices by a disproportionate amount and bid and offer prices can be far apart. 

Inflation 

Increase in the general price of goods and services. 

Interest Rate Swap 

An agreement between two parties (known as counterparties) where one stream of future interest payments is exchanged for another based on a specified principal amount. Interest rate swaps often exchange a fixed payment for a floating payment that is linked to an interest rate (most often the LIBOR). A company will typically use interest rate swaps to limit or manage exposure to fluctuations in interest rates, or to obtain a marginally lower interest rate than it would have been able to get without the swap. 

Interest rate swaps are simply the exchange of one set of cash flows (based on interest rate specifications) for another. Because they trade OTC, they are just contracts set up between two or more parties, and thus can be customized in any number of ways. 

Swaps are sought by firms that desire a type of interest rate structure that another firm can provide less expensively. For example, let’s say Cory’s Tequila Company (CTC) is seeking to loan funds at a fixed interest rate, but Tom’s Sports Inc. (TSI) has access to marginally cheaper fixed-rate funds. Tom’s Sports can issue debt to investors at its low fixed rate and then trade the fixed-rate cash flow obligations to CTC for floating-rate obligations issued by TSI. Even though TSI may have a higher floating rate than CTC, by swapping the interest structures they are best able to obtain, their combined costs are decreased – a benefit that can be shared by both parties. 

Introducing Broker (IB) 

A futures broker who has a direct relationship with a client but delegates the work of the floor operation and trade execution to another futures merchant. The merchant firm is usually a close partner of the IB.  This is done to increase efficiency and lower the workload for futures brokers. It allows the IB to focus on the client while the futures merchant focuses on trading floor operations. 

 

More Information: 
https://oxsecurities.com/partnerships/introducing-brokers/ 
https://oxsecurities.com/partnerships/money-managers/ 
https://oxsecurities.com/partnerships/white-label/ 
https://oxsecurities.com/partnerships/regional-partnerships/ 

 

Institutional Investor 

A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. Institutional investors face fewer protective regulations because it is assumed that they are more knowledgeable and better able to protect themselves. 

Watching what the big money is buying can sometimes be a good indicator, as they (supposedly) know what they are doing. Some examples of institutional investors are pension funds and life insurance companies. 

More Information: 
https://oxsecurities.com/account/client-verification-process/  

Interbank Rates 

Interbank rates can refer to either (1) the FX rates quoted to each other by international banks, or (2) the rate of interest which banks charge each other on a short-term basis. 

Intraday Trading 

Trading where positions are opened and then closed out within the same trading day. 

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Latency 

Latency is the delay between the time you send an order to the time it is received by the server. The further your message must travel, the longer it takes to get there, so the higher the latency. In trading, higher latency may result in higher slippage. 

Leverage 

Leverage allows traders to gain a large exposure with a relatively small outlay. This has the effect of amplifying profit or loss. A leverage of 1:100 means that to open and maintain a position the necessary margin is one hundred times less than the transaction size. 

More Information: 
https://oxsecurities.com/metatrader-cfd/forex-cfds/ 
https://oxsecurities.com/metatrader-cfd/indices-cfds/ 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/metatrader-cfd/commodities-cfds/ 
https://oxsecurities.com/iress-share-cfd/shares-cfds/ 
https://oxsecurities.com/product-schedule/  

London InterBank Offered Rate (LIBOR) 

The interest rate charged between banks in London for short-term loans and a key benchmark that influences many other interests rate charges/products. Individual currency denominations have an associated Libor. It is produced for ten currencies with 15 maturities quoted for each, ranging from overnight to 12 months, producing 150 rates each business day. 

Limit Order 

A Limit Entry order is an order placed to either buy below the market or sell above the market at a certain price. 

Limited Risk (Controlled Risk) 

A trade which has a strictly limited maximum loss, usually by virtue of a guaranteed stop. 

Liquidity Provider 

A liquidity provider connects many brokers and traders together, increasing the liquidity of the joint market. A higher liquidity is desirable for everyone, as it drives down the spread and thus the cost of trading. Liquidity providers are often large banks and other financial institutions. 

More Information: 
https://oxsecurities.com/trading-accounts/spreads/  

Lots 

Lots are the standard trading term used in MT4. In FX, there are 4 common lot sizes. We do not offer nano lots. 

  • 1 Nano (0.001) Lot is 100 units of base currency 
  • 1 Micro (0.01) Lot is 1,000 units of base currency 
  • 1 Mini (0.1) Lot is 10,000 units of base currency 
  • 1 Standard (1) Lot is 100,000 units of base currency 


For details on lot sizes on other CFDs, please refer to the Product Schedules:
https://oxsecurities.com/product-schedule/ 

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Margin 

Margin is a good faith deposit. In leveraged trading, the margin amount is the minimum amount of free equity required before opening a new trade. This is held in deposit while the trade is open. 

  • Initial Margin is an amount of money, which is due from you at the time the Position is entered into.   
  • Variable Margin is an amount payable when a Position moves against you. 

Margin Account 

A brokerage account in which the broker lends the customer cash to purchase securities. The loan in the account is collateralized by the securities and cash. If the value of the stock drops sufficiently, the account holder will be required to deposit more cash or sell a portion of the stock. In a margin account, you are investing with your broker’s money. By using leverage in such a way, you magnify both gains and losses. 

Margin Call 

A broker’s demand on an investor using margin to deposit additional money or securities so that the margin account is brought up to the minimum maintenance margin. Margin calls occur when your account value depresses to a value calculated by the broker’s particular formula. This is sometimes called a “fed call” or “maintenance call.” 

You would receive a margin call from a broker if one or more of the securities you had bought (with borrowed money) decreased in value past a certain point. You would be forced either to deposit more money in the account or to sell off some of your assets.  

Market Depth 

Lists all the buy and sell orders in the market for a particular security and organised by price level. 

Market Execution 

An order that is executed at the best price available in the market, with no requotes. 

MAS 

Monetary Authority of Singapore, the financial regulator in Singapore, also the default central bank of the country.  

Market Order 

An order that you use to specify the direction and size of a trade, but not the price. This ensures your order will be filled as quickly as possible. 

Mark-to-Market 

The daily adjustment of an account to reflect accrued profits and losses often required to calculate variations in margins. 

Mid Price 

The bid plus the offer, divided by two. 

Mining  

This is the process of using computer power to process transactions on a blockchain. Miners are rewarded with newly created cryptocurrency for each block they process. 

Money Management Systems 

MAM, PAMM, and LAMM are different money-management systems 

MAM (Multi-Account Manager) accounts allow manager to assign a higher leverage to specific sub-accounts.  

  • Under PAMM (Percent Allocation Management Module), the investors’ portfolio is affected by the size of their deposits.  
  • Typically, the PAMM manager is also trading with his/her own funds. 
  • Under LAMM (Lot Allocation Management Module), whenever the manager buys one standard lot of an asset, every customer’s account would automatically increase by one standard lot. Unlike PAMM, the system does not consider the size of each investor’s deposit. 

More Information 
https://oxsecurities.com/partnerships/introducing-brokers/ 
https://oxsecurities.com/partnerships/money-managers/ 
https://oxsecurities.com/partnerships/white-label/ 
https://oxsecurities.com/partnerships/regional-partnerships/ 

MetaTrader 4 (MT4) 

MT4 is an electronic trading platform widely used by online retail foreign exchange speculative traders. It was developed by MetaQuotes Softwareand released in 2005. The software is licensed to foreign exchange brokers who provide the software to their clients. 

The software consists of both a client and server component. The server component is run by the broker and the client software is provided to the broker’s customers, which use it to see live streaming prices, charts and to place orders as well as manage their account. 

More Information: 
https://oxsecurities.com/trading-platforms/metatrader-4/ 
https://oxsecurities.com/trading-platforms/metatrader-5/ 
https://oxsecurities.com/trading-platforms/iress/ 

 

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Non-Dealing Desk (NDD) 

An execution model that allows you to trade directly with numerous market liquidity providers in order to get the most competitive bid and ask prices. 

Non-Farm Payrolls (NFP) 

A notable economic indicator normally released on the first Friday of every month by the US Department of Labor. It presents the number of people on the payrolls of all businesses, except for agricultural, local government, private household and non-for-profit. The monthly figure can change significantly, and often leads to a high level of volatility in FX pairs such as EUR/USD, around the time of the release. Generally, a high reading is seen as positive (or bullish) for the US dollar, while a low reading is seen as negative (or bearish). 

More Information: 
https://oxsecurities.com/education/economic-calendar/ 

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Offer Price 

The price at which the seller is willing to sell at. 

Option 

The right, but not the obligation, to buy (‘call option’) or sell (‘put option’) a specific amount of a given stock, commodity, currency, or index at a specified price (the ‘strike price’) during a specified period. For the holder, the potential loss is limited to the price paid to acquire the option. When an option is not exercised, it expires. 

One Cancels the Other (OCO) Order 

An OCO Order lets you place a sell limit and sell stop order on the same stock at the same time. When either order is executed the other will automatically be cancelled.  

One Triggers the Other (OTO) Order 

An OTO Order is the opposite of an OCO Order, as it only puts on orders when the parent order is triggered. 

Out-ofHours 

Refers to trading outside the main opening hours of major markets. 

More Information: 
https://oxsecurities.com/metatrader-cfd/trading-hours/  

Over the Counter (OTC) 

An over-the-counter (OTC) instrument is traded without going through an exchange. It is traded directly between two parties. 

Financial instruments such as currencies, stocks and commodities can be traded OTC, with no physical location and done electronically. 

OPEC 

Organization of the Petroleum Exporting Countries, a intergovernmental organisation of 14 oil-producing nations headquartered in Vienna, Austria. It coordinates petroleum policies of its member countries and runs as a cartel to reduce market competition with production ceilings. 

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PAMM (Percent Allocation Management Module) 

PAMM is a form of money-management system. An investor gets to allocate his or her money in desired proportion to the qualified trader(s)/money manager(s) of his or her choice. These traders/managers may manage multiple forex trading accounts using their own capital and such pooled moneys, with an aim to generate profits. 

More Information 
https://oxsecurities.com/partnerships/introducing-brokers/ 
https://oxsecurities.com/partnerships/money-managers/ 
https://oxsecurities.com/partnerships/white-label/ 
https://oxsecurities.com/partnerships/regional-partnerships/ 

PBOC 

People’s Bank of China, the central bank agency of China.  

Pip 

Normally used in reference to forex rates, a ‘percentage in point’ is generally, though not always, the fourth decimal place, i.e. 0.0001.  
 
More Information: 
https://oxsecurities.com/trading-accounts/account-types/ 

Phishing  

The fraudulent practice of sending emails purporting to be from reputable companies to induce individuals to reveal personal information, such as passwords and credit card numbers. 

Prime Broker (PB) 

A special group of services that many brokerages give to special clients. The services provided under prime brokering are securities lending, leveraged trade executions, and cash management, among other things. Prime brokerage services are provided by most of the large brokers, such as Goldman Sachs, Paine Webber, and Morgan Stanley Dean Witter. 

Hedge funds were what started the prime brokerage option. Hedge funds place large trades and need special attention from brokerages. 

Principal Orders 

A type of order carried out by a broker-dealer which involves the broker-dealer buying or selling for its own account and at its own risk, as opposed to carrying out trades for the brokerage’s clients. 

When a broker-dealer is acting on its own behalf, as opposed to brokering transactions for its clients, it must properly denote to the exchange that it is doing so. These kinds of transactions are also known as “principal trades”. 

Proprietary Trading 

When a firm trades for direct gain instead of commission dollars. Essentially, the firm has decided to profit from the market rather than from commissions from processing trades. Firms that engage in proprietary trading believe that they have a competitive advantage that will enable them to earn excess returns. 

Portfolio 

A collection of investments owned by an individual or company. 

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Quantitative Easing 

A measure adopted by central banks to stimulate an economy when traditional monetary policy measures (like cutting interest rates) have failed. The central bank electronically creates funds in its own bank account to purchase previously issued government bonds, plus private sector and distressed assets (so companies can raise capital). This serves to create more tradable and liquid markets to help stimulate the economy. 

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Relative Strength Index (RSI) 

A chart indicator used in technical analysis. It identifies when trends are coming to the end of their current direction, as well as overbought and oversold market conditions. 

Resistance Level 

A term used in technical analysis indicating a price level at which analysis suggests a predominance of selling – and hence a greater likelihood that the price will fail to break through the level. 

RBA 

Reserve Bank of Australia (RBA), the central bank agency of Australia. 

RBI 

Reserve Bank of India, the central bank agency of India 

Rollover 

Closing an expiring futures position and reopening the position in the next tradeable future. In forex, the value of the process is measured by the interest rate differential between the two currencies. There’s usually a small cost for rolling over positions. 

Running Profit / Loss 

The profit or loss which you would realise by closing your open positions at the prevailing market prices. 

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Scalping 

A trading strategy that involves placing short-term trades, sometimes less than a minute long, usually to try and capture small price movements. 

Sell Limit Entry Order 

An order to open a sell position only at the designated price or higher. 

Sell Stop Entry Order 

An order to open a sell position only at the designated price or lower. 

Slippage 

The difference between the requested level of an order and the actual price at which it was executed. Slippage can occur during periods of higher volatility when market prices move rapidly or gap. 

Spot Price 

The price quoted for immediate settlement or delivery of a currency, index, commodity, or share (that is payment for and delivery of a product). It’s the current price at which a commodity or currency can be bought or sold at that specific time. 

Spot Rate 

An exchange rate for immediate settlement. 

Spread 

The difference between the buy price and sell price.  

More Information: 
https://oxsecurities.com/trading-accounts/spreads/ 

Stop Entry Order 

A Stop Entry order is an order placed to buy above the market or sell below the market at a certain price. 

Stop Loss 

A Stop Lossspecifies the price at which to close a position to cap losses. 

Straight Through Processing (STP) 

An STP broker typically routes some or all your orders directly to the market. 

More Information: 
https://oxsecurities.com/metatrader-cfd/forex-cfds/ 
https://oxsecurities.com/metatrader-cfd/indices-cfds/ 
https://oxsecurities.com/metatrader-cfd/cryptocurrency-cfds/ 
https://oxsecurities.com/metatrader-cfd/commodities-cfds/ 
https://oxsecurities.com/iress-share-cfd/shares-cfds/ 
https://oxsecurities.com/product-schedule/ 

Support Level 

A technique used in technical analysis to indicate a price floor at which you would expect the price to ‘bounce’ off. A price point where it is anticipated buyers will enter the market and ‘support’ the price. The opposite of this is resistance. 

Swissie 

A slang term for the Swiss franc. 

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Take Profit 

A Take Profitspecifies the price at which to close a position for a profit. 

Technical Analysis 

A technique used to try and predict future movements of a security, commodity, or currency, based solely on past price movements and volume levels. It examines charts and historical performance to forecast prices by analysing market data, such as historical price trends, averages, and volumes. 

Tick 

A single price movement which can be either positive or negative. 

Trailing Stop 

Trailing stops are a special type of stop loss order that trail behind the market price when the market moves in your favour. 

A Trailing Stop allows a trade to continue to gain in value when the market price moves in a favourable direction, but automatically closes the trade if the market price suddenly moves in an unfavourable direction by a specified distance. 

Treasury 

A bond issued by a government. Bonds issued by the UK government are called gilt-edged stocks, commonly referred to as gilts. 

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Uptick 

A price quoted that is higher than the previous quote. 

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Value at Risk (VaR)

VaR measures and quantifies the level of financial risk within a firm or investment portfolio over a specific time frame.  
It determines the (i) potential for loss in the asset, and (ii) the probability that the loss will occur. 

Volatility 

An explanation of how quickly the price of a market or instrument rises or falls. A highly volatile market can be risky for short-term investors as they risk buying at a peak or selling in a trough at a loss. 

Volume Weighted Average Price (VWAP) 

 A method of pricing an instrument accounting for the volume available to trade at a particular price. 

 

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Wall Street 

An alternative, well-known term for the New York Stock Exchange (NYSE), the largest stock exchange in the US. 

More Information: 
https://oxsecurities.com/education/economic-calendar/ 

White Label Product 

A product manufactured by one company that is packaged and sold by other companies under varying brand names. The end-product appears as though it is being made by the marketer, when it is being created by the manufacturing company. 

In this case, the manufacturer can concentrate on making the product or service and focus on cost savings, rather than worrying about marketing, which will be handled by the companies that will sell the product. 

A common example of a white label product can be found in your local supermarket. You may have noticed that many of these stores have their own brand-name products, which usually sell at a discount relative to other well-known brands. The store-brand product is created by a manufacturing company that places the store’s label on the final product in an attempt to make customers think it was created by the vendor. 

More Information 
https://oxsecurities.com/partnerships/introducing-brokers/ 
https://oxsecurities.com/partnerships/money-managers/ 
https://oxsecurities.com/partnerships/white-label/ 
https://oxsecurities.com/partnerships/regional-partnerships/ 

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Yard 

A slang trading term for a billion units. 

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3DS or 3D Secure 

3D Secure is a protocol (set of rules) that provides extra protection for merchants and customers for online payments. It is used to authenticate the cardholder during payment processing, similar to entering a PIN for an ATM or EFTPOS transaction. The basic concept of the protocol is to tie the financial authorisation process with an online authentication. This authentication is based on a three-domain model (hence the 3-D in the name).