A


A-Book

A-Book is a type of execution forex model. It is also known as an STP (Straight Through Processing) Broker or a non-dealing desk Broker. In this model, Brokers earn money by charging commission or making a slight change in the spreads. It works through a bridge that connects a trader’s terminal directly to a liquidity provider. When a Broker operates under the A-Book model, it passes the orders directly to the Liquidity Provider. Depending on the LP’s set up it can stay within its liquidity pool or be passed to other LP’s pools. A liquidity pool consists of many entities acting as a counterpart to the trades flowing out from your forex Broker.

Account Extension

If you are performing well and you meet all Challenge’s criteria, you are eligible to buy an Extension. For example, you have 3 days before the challenge ends, you have the option to extend your trading period timeframe by an additional 30 days. This will allow you enough time to reach the Profit Target(s) without having to start over.

Account Reset

If you run the risk of breaching the trading parameters during your challenge, you are eligible for a Reset at a discounted price. A new account will open with the remaining days of the challenge. If you have chosen to reset your account 5 days after your initial purchase, then your fresh account will start with the remaining 25 days. There are no limits as to how many resets you can get. If you breached your account, don’t worry, we will email you a unique link that will still allow you to reset and resume your challenge.

Affiliate Marketing

Is a process where publishers earn a commission by promoting a product or service made by another retailer or advertiser.

Aggregated

Aggregation is the consolidation of an individual's financial data from multiple institutions to one singular institution. Account aggregation, as a finance management concept, is typically completed by an individual's financial planner to create cohesion, clarity, and simplicity

Agriculture

Agricultural trade involves the buying and selling of products that have been produced through the forestry and farming industries. It can give consumers greater access to a variety of agriculture goods, often at more affordable prices.

Algorithmic Trading (algo-trading)

Automated transactions where a computer algorithm decides the order of submission and execution with little or no human intervention.

API

Application Programming Interface, a software interface that allows two applications to talk to each other.

Arbitrage

a method of trading a security or commodity in which the trader attempts to profit from price differences between several markets, generally with a view to making a purchase on one market and selling it on another at a higher price.

ATAS

ATAS (Advanced Trading Analytical Software), a professional prop trading and analytical platform

Augmented trading

a trading approach where human capabilities are augmented with self-learning AI. The augmented trading expert moves into the role of a designer, combining market knowledge with the latest AI technology to deliver unmatched trading performance, to discover new ways of trading, and to stay ahead of the constantly changing market.

B


B-Book

B-Book forex model is also known as a Market Maker. In this model, a Broker chooses to trade against his clients. There is no external liquidity pool where the Broker executes trades. In this case, it acts as a counterparty to his trades. In simple terms, if a trader places a buy order, a Broker will be selling to him and vice versa. Thus, it is clear that this type of model generates conflicts of interest between Brokers and their clients.

Broker Neutral

Broker neutral means the trading system is provided by an independent vendor that will connect to any broker that you require. You are their client, and they are not affiliated or loyal to a specific broker.

Buying Power

Purchasing power is the value of a currency expressed in terms of the number of goods or services that one unit of money can buy.

C


Central Bank

Financial institution that exercises control over key aspects of the financial system. Central banks include the following entities: national central banks, central banks of a currency union, currency boards and government-affiliated agencies that are a separate institutional unit and primarily perform central bank activities. In the LBS, the BIS is classified as a central bank

Commodity

A raw material or primary agricultural product that can be bought and sold, such as copper or coffee.

commodity forward

Contract between two parties to purchase or sell a commodity or commodity index at an agreed price on a future date.

Commodity Market

A commodity market is a marketplace for buying, selling, and trading raw materials or primary products.

Commodity Option

Contract that gives the buyer the right (but not the obligation) to purchase or sell a commodity or commodity index at an agreed price at or by a specified date.

Commodity Swap

Contract between two parties to exchange sequences of payments during a specified period, where at least one sequence of payments is tied to a commodity price or commodity index.

Contracts or Financial Contracts

A financial contract is a deal in the form of an independently arranged agreement, contract, or an option to sell, buy, swap, lend, or repurchase, or some other similar independently arranged transaction that is typically entered into between parties participating in the financial markets.

Cryptos / Cryptocurrency

A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend.

Currency swap

Contract between two parties to exchange sequences of payments during a specified period, where each sequence is tied to a different currency. At the end of the swap, principal amounts in the different currencies are usually exchanged.

D


Day Trading

Day trading is a form of speculation in securities in which a trader buys and sells a financial instrument within the same trading day, so that all positions are closed before the market closes for the trading day to avoid unmanageable risks and negative price gaps between one day's close and the next day's price at the open.

Derivative

A derivative is set between two or more parties that can trade on an exchange or over-the-counter (OTC). These contracts can be used to trade any number of assets and carry their own risks. Prices for derivatives derive from fluctuations in the underlying asset.

Derivative Trading

Derivatives are essentially contracts that derive their value from an underlying asset. Derivative contracts are short-term financial instruments that come with a fixed expiry date. The underlying asset can be stocks, commodities, currencies, indices, exchange rates, or even interest rates. Derivative trading involves both buying and selling of these financial contracts in the market. With derivatives, you can make profits by predicting the future price movement of the underlying asset.

Drawdown

A drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund. A drawdown is usually quoted as the percentage between the peak and the subsequent trough.

E


Equity

Derivative trading is when traders speculate on the future price action of an asset via the buying or selling of derivative contracts with the aim of achieving enhanced gains when compared with buying the underlying asset outright.

Eurobond

Bond denominated in a currency other than the local currency of the country where the bond is issued. Eurobonds are underwritten by an international syndicate of financial institutions and sold to international investors, eg a US dollar-denominated bond issued in the United Kingdom and sold to investors worldwide. Eurobonds denominated in US dollars are known as eurodollar bonds, and those denominated in yen as euroyen bonds.

Exchange

An exchange is a marketplace where securities, commodities, derivatives and other financial instruments are traded. The core function of an exchange is to ensure fair and orderly trading and the efficient dissemination of price information for any securities trading on that exchange.

Exchange Rate

The price of one country's currency in relation to another.

F


Fixed Interest Rate

Interest rate that is fixed for the life of the debt instrument or for a certain number of years. At the date of inception, the timing and value of coupon payments and principal repayments are known.

Foreign Exchange Swap

Transaction involving the actual exchange of two currencies (principal amount only) on a specific date at a rate agreed at the time of the conclusion of the contract (the short leg), and a reverse exchange of the same two currencies at a date further in the future at a rate (generally different from the rate applied to the short leg) agreed at the time of the contract (the long leg).

Forex

Foreign Exchange (forex or FX) is the trading of one currency for another. For example, one can swap the U.S. dollar for the euro.

Funding

The money or capital provided, especially by an organization or a firm, for a particular purpose.

Futures

Contracts for assets (especially commodities or shares) bought at agreed prices but delivered and paid for later.

G


Gross Market Value

Sum of the absolute values of all outstanding derivatives contracts with either positive or negative replacement values evaluated at market prices prevailing on the reporting date. Thus, the gross positive market value of a dealer's outstanding contracts is the sum of the replacement values of all contracts that are in a current gain position to the reporter at current market prices (and therefore, if they were settled immediately, would represent claims on counterparties). The gross negative market value is the sum of the values of all contracts that have a negative value on the reporting date (ie those that are in a current loss position and therefore, if they were settled immediately, would represent liabilities of the dealer to its counterparties). The term "gross" indicates that contracts with positive and negative replacement values with the same counterparty are not netted. Nor are the sums of positive and negative contract values within a market risk category such as foreign exchange contracts, interest rate contracts, equities and commodities set off against one another. Gross market values supply information about the potential scale of market risk in derivatives transactions and of the associated financial risk transfer taking place. Furthermore, gross market value provides a measure of economic significance that is readily comparable across markets and products.

H


Heatmap

A representation of data in the form of a map or diagram in which data values are represented as colours.

Hedge fund

Unregulated investment fund and various types of money managers, including commodity trading advisers (CTAs), which share (a combination of) the following characteristics: they often follow a relatively broad range of investment strategies that are not subject to borrowing and leverage restrictions, with many of them using high levels of leverage; they often have a different regulatory mandate than "institutional investors" and typically cater to sophisticated investors such as high net worth individuals or institutions; and they often hold long and short positions in various markets, asset classes and instruments, with frequent use of derivatives for speculative purposes.

Hedge Fund Manager

A hedge fund manager is a financial company or individual that employs professional portfolio managers and analysts in order to establish hedge funds. H

High Watermark

A high-water mark is the highest peak in value that an investment fund or account has reached. This term is often used in the context of fund manager compensation, which is performance-based.

High-frequency trading (HFT)

An algorithmic trading strategy that profits from incremental price movements, with frequent, small trades executed in milliseconds for very short investment horizons. HFT is a subset of algorithmic trading

I


Index product

Multi-name CDS contract with constituent reference credits and a fixed coupon that are determined by an administrator such as Markit (which administers the CDX and iTraxx indices). Index products include tranches of CDS indices.

Institutional trader

Institutional traders buy and sell securities for accounts they manage for a group or institution. Pension funds, mutual fund families, insurance companies, and exchange traded funds (ETFs) are common institutional traders.

International Securities Identification Number (ISIN)

An International Securities Identification Number (ISIN) is a 12-digit alphanumeric code that uniquely identifies a specific security. The organization that allocates ISINs in any particular country is the country's respective National Numbering Agency (NNA).

Investing

put (money) into financial schemes, shares, property, or a commercial venture with the expectation of achieving a profit.

Investment

Investor

An investor is any person or other entity (such as a firm or mutual fund) who commits capital with the expectation of receiving financial returns.

J


Jensen Index

An index that uses the capital asset pricing model to determine whether a money manager outperformed a market index. The alpha of an investment or investment manager.

K


Know Your Customer (KYC)

An ethical foundation of securities brokers that an adviser who recommends the purchase or sale of any security to a customer, must believe that the recommendation is suitable for the customer, given the customer's financial situation.

L


Limited Risk

The risk inherent in options contracts, which is much lower than that of a futures contract, which has unlimited risk. The maximum loss in buying a call option, for example, is the premium paid for the option.

London Stock Exchange (LSE)

The U.K.'s six regional exchanges joined together in 1973 to form the stock exchange of Great Britain and Ireland, later named the LSE. The FTSE 100 index (known as the footsie) is its dominant index.

M


Market

Known as financial market.

Financial Markets include any place or system that provides buyers and sellers the means to trade financial instruments, including bonds, equities, the various international currencies, and derivatives. Financial markets facilitate the interaction between those who need capital with those who have capital to invest.

Market Data

Market data refers to the live streaming of trade-related data. It encompasses a range of information such as price, bid/ask quotes and market volume

Market Research

Market research is the process of determining the viability of a new service or product through research conducted directly with potential customers. Market research allows a company to discover the target market and get opinions and other feedback from consumers about their interest in the product or service.

Max Daily Drawdown

What Is a Maximum Drawdown (MDD)? A maximum drawdown (MDD) is the maximum observed loss from a peak to a trough of a portfolio, before a new peak is attained. Maximum drawdown is an indicator of downside risk over a specified time period.

Max Drawdown

A maximum drawdown (MDD) is the maximum observed loss from a peak to a trough of a portfolio, before a new peak is attained.

Micro Futures

Micro futures allow investors to trade against the stock market at large. They're priced so that ordinary investors can afford to trade futures on the major market indices, which have otherwise gotten so expensive that only major investors can afford to trade those futures.

Multi-asset

A multi-asset class, also known as a multiple-asset class or multi-asset fund, is a combination of asset classes (such as cash, equity or bonds) used as an investment. A multi-asset class investment contains more than one asset class, thus creating a group or portfolio of assets.

N


Nasdaq-100

The Nasdaq 100 Index is a basket of the 100 largest, most actively traded U.S companies listed on the Nasdaq stock exchange. The index includes companies from various industries except for the financial industry, like commercial and investment banks. These non-financial sectors include retail, biotechnology, industrial, technology, health care, and others.

Net market value

Similar to gross credit exposure, with the difference that netting is restricted to one type of derivative product instead of across all products. In the OTC derivatives statistics, net market values are reported for CDS only.

News Trading

A news trader is a trader or investor who makes decisions based on news announcements.

O


Overnight Positions

Simply put, overnight positions are trading positions that are not closed by the end of the trading day. These trades are held overnight for trading the following day. Overnight positions expose the traders to risk from adverse movements that occur after normal trading closes.

P


Payout

A payment of money, especially as compensation or a dividend.

Profit

A financial gain, especially the difference between the amount earned and the amount spent in buying, operating, or producing something.

Profit Split

Profit split is a method to divide the profit of an external sales transaction between the entities involved in the transaction.

Prop Trader

Prop traders use the capital provided by a company to conduct trades involving assets classes like futures, stocks, currencies, and commodities. The more complex trades include derivatives of these assets. A prop trader can work for an online broker or a financial firm

Prop Trading

occurs when a bank or firm trades stocks, derivatives, bonds, commodities, or other financial instruments in its own account, using its own money instead of using clients' money.

Proprietary Trading

Proprietary trading refers to a financial firm or commercial bank that invests for direct market gain rather than earning commission dollars by trading on behalf of clients. Also known as "prop trading," this type of trading activity occurs when a financial firm chooses to profit from market activities rather than thin-margin commissions obtained through client trading activity. Proprietary trading may involve the trading of stocks, bonds, commodities, currencies or other instruments.

Q


QUANTOWER

Quantower is the platform for many experienced traders interested in trading a variety of assets as it offers access to Forex, CFDs, Cryptos, Options, Futures and Stocks.

R


Retail Trader

A retail trader is an individual trader who trades with money from personal wealth, rather than on behalf of an institution. A retail trader is someone who trades their own money, but not for a living.

Risk-Free

Is used to describe something that does not involve any risk: This strategy is not entirely risk-free

RITHMIC

Rithmic is one of the most popular trading platforms for futures traders due its low latency which facilitates high performance

S


Scaling Plan

The scaling plan can help you create a shared vision for scaling up your idea or investment.

Share Market

A market in which securities are bought and sold; a stock exchange.

Shares

One of the equal parts into which a company's capital is divided, entitling the holder to a proportion of the profits.

Shares Certficate

A share certificate is a written document signed on behalf of a corporation that serves as legal proof of ownership of the number of shares indicated. A share certificate is also referred to as a stock certificate.

Stocks

A share which entitles the holder to a fixed dividend, whose payment takes priority over that of ordinary share dividends.

T


Trade latency

Trade latency refers to the time interval between an order being placed and its execution. Lower latency is desirable as it means that a trader has a higher possibility of securing the price displayed before the market moves. Traders can reduce the latency of their trading by subscribing to a VPS service.

Trading Challenge

A test in which a trader is called to test or justify his trading experience and knowledge.

Trading Platform

A trading platform is a software system offered to investors and traders by certain financial institutions, such as brokerages and banks.

Trailing

What does Trailing mean in finance? Trailing refers to the property of a measurement, indicator, or data series that reflects a past event or observation. It is usually attached to a specified time interval by which the data trail or over which that data are aggregated, summed, or averaged.

U


U.S. Dollar Index

Measures the U.S. dollar’s value against a basket of six overseas denominations.

Unemployment rate

The percentage of the people classified as unemployed as compared to the total labor force.

V


Volume

The number of shares traded in a particular stock, index, or other investment over a specific period of time.

W


Wall Street

Generic term for the securities industry firms that buy, sell, and underwrite securities.

Weighted average cost of capital (WACC)

Expected return on a portfolio of all a firm's securities. Used as a hurdle rate for capital investment. Often the weighted average of the cost of equity and the cost of debt The weights are determined by the relative proportions of equity and debt in a firm's capital structure.

West Texas Intermediate (WTI)

A popular benchmark oil price. WTI is the underlying asset in the New York Mercantile Exchange's oil futures contract. This type of oil has a low sulphur content (sweet). The U.S. Department of Energy maintains historical data for this oil price. It is sometimes known as WTI - Cushing or WTI, Cushing, Oklahoma.

X


XRP

Refers to the cryptocurrency issued by Ripple on its blockchain. The currency is not collateralized and Ripple focuses on global payments.

Y


Year-end dividend

A special dividend declared at the end of a fiscal year that usually represents distribution of higher-than-expected company profits.

Yield

The percentage return paid on a stock in the form of dividends, or the effective rate of interest paid on a bond or note.

Z


Zero-balance account (ZBA)

A checking account in which zero balance is maintained by transfers of funds from a master account in an amount only large enough to cover checks presented.