How to trade options book pdf16 comments
How to trade options freedom 2nd edition epub
Il trading comporta un rischio per il tuo capitale e potrebbe non essere adatto a tutti gli investitori. A notification, often received by email or SMS, of a market event such as a stock or currency reaching a target price. A currency is said to appreciate when price rises in response to market demand; an increase in the value of an asset. Taking advantage of countervailing prices in different markets by the purchase or sale of an instrument and the simultaneous taking of an equal and opposite position in a related market to profit from small price differentials.
The Available Margin acts as collateral against losses, therefore when the Available Margin hits zero or below, this results in a margin call among most brokers.
The departments and processes related to the settlement of financial transactions i. A record of a nation's claims of transactions with the rest of the world over a particular time period.
These include merchandise, services and capital flows. The value of a country's exports minus its imports. A type of chart which consists of four significant points: The currency in which an investor or issuer maintains its book of accounts; the currency that other currencies are quoted against.
A market distinguished by a prolonged period of declining prices accompanied with widespread pessimism. Believing that a particular security, sector, or the overall market is about to fall. There are many ways to measure a Bear Market. A reversal pattern characterized by a large candlestick followed by a much smaller candlestick. The second candle is located within the range of the prior candle's body, and is always smaller than the previous body.
Such a pattern is an indication that the previous upward trend is coming to an end. A formation of either one or numerous candlesticks, indicating that the prior downtrend is about to end. The price that a buyer is prepared to purchase at; the price offered for a currency.
The price at which an investor, trader or institution is willing to sell the security. Dealer phrase referring to the first few digits of an exchange rate. These digits rarely change in normal market fluctuations, and therefore are omitted in dealer quotes, especially in times of high market activity. A technical indicator forming an envelope around the trading price. The envelope is calculated using standard deviations and shows price volatility.
Bonds are tradable instruments debt securities which are issued by a borrower to raise capital. They pay either fixed or floating interest, known as the coupon. As interest rates fall, bond prices rise and vice versa. Bretton Woods Agreement of The agreement lasted until , when President Nixon overturned the Bretton Woods agreement and established a floating exchange rate for the major currencies.
An individual, or firm that acts as an intermediary, putting together buyers and sellers usually for a fee or commission. A market distinguished by a prolonged period of rising prices. Opposite of bear market.
Bullish refers to having a positive outlook on a particular security or an investment The shadows or tails of the small candlestick are short, which enables the body of the large candlestick to cover the entire candlestick from the previous day. A candlestick chart pattern in which a large candlestick is followed by a smaller candlestick whose body is located within the vertical range of the larger body.
A formation of either one or numerous candlesticks, indicating that the prior uptrend is about to end. A candlestick chart is a style of bar-chart used primarily to describe price movements of a security finance , derivative, or currency over time. Candlestick charts provide a quick visual picture of the relationship between opening and closing prices and their relative strengths or weaknesses, especially for extended periods.
The body, which looks like a candle, represents the difference between opening and closing prices. The rectangle represents the body of the candle and indicates the difference between the opening and closing price. Markets for medium to long term investment usually over 1 year. These tradable instruments are more international than the 'money market' i. Government Bonds and Eurobonds. For example, the US central bank is the Federal Reserve.
A chart is a collection of historical price action that is represented visually. An individual who uses charts and graphs and interprets historical data to find trends and predict future movements. Also referred to as Technical Trader. Exposures in Foreign Currencies that no longer exist. The process to close a position is to sell or buy a certain amount of currency to offset an equal amount of the open position. This will 'square' the position. The final price at which a security is traded on a given trading day.
The price of the last transaction for a given security at the end of a given trading session. Also known as the 'close'.
A basic good, such as food, grains, and metals, which is interchangeable with. A document exchanged by counterparts to a transaction that confirms the terms of said transaction.
To be cautious or risk averse in an investment strategy. A period of indecisiveness where the price moves within a trading range. The participant, either a bank or customer, with whom the financial transaction is made. An exchange rate between two currencies. The cross rate is said to be non-standard in the country where the currency pair is quoted. Any form of money issued by a government or central bank and used as legal tender and a basis for trade.
The two currencies that make up a foreign exchange rate. The risk of incurring losses resulting from an adverse change in exchange rates. A chart pattern where a black candlestick follows a long white candlestick. This will indicate the possibility of an upcoming bearish trend. Opening and closing the same position or positions within the same trading session. An individual that acts as a principal to a transaction and is the responsible for the company's risk by reviewing the customer margin, the trading rates, the deal size, etc.
An actual delivery where both sides transfer possession of the currencies traded. A decline in the value of a currency due to market forces. A contract that changes in value in relation to the price movements of a related or underlying security, future or other physical instrument. An Option is the most common derivative instrument. The deliberate downward adjustment of a currency's value, normally by official announcement. A statistic that indicates about the economic situation and that is issued by the government or a non-government institution i.
A monetary union is an arrangement where several countries have agreed to share a single currency amongst them. The European Economic and Monetary Union EMU consists of three stages coordinating economic policy, achieving economic convergence that is, their economic cycles are broadly in step and culminating with the adoption of the euro, the EU's single currency.
End Of Day Mark-to-Market: Traders account for their positions in two ways: An accrual system accounts only for cash flows when they occur, hence, it only shows a profit or loss when realized.
Any profit or loss is booked and the trader will start the next day with a net position. The price at which an investor closes his open position. The exit point is usually decided as part of a premeditated trading strategy meant to mitigate investment risk and take the emotion out of trade decisions.
Executing a deal or deals that results in balancing the exposure in a specific currency or of the entire exposure, so there is no risk to the trader's investment regardless to the exchange rate.
The percentage of exposure that is covered by funds. Exposure coverage is calculated by dividing your Total Equity by your Net Exposure. Fixed Exchange Rate Representative Rate: An official exchange rate set by monetary authorities for one or more currencies.
To be neither long nor short is the same as to be flat or square. The Federal Reserve the U. Forex - Foreign Exchange: The simultaneous buying of one currency and selling of another in an over-the-counter market. A Forex deal which its value date is more than Spot 2 business days. The rate of a Forward deal is different from the rate of Spot deal, as it considers the interest rate differences.
The pips added to or subtracted from the current exchange rate to calculate a forward price. Front and Back Office: Front office is a business term that refers to a company's departments that come in contact with clients, including the marketing, sales, and service departments. In our case, also the trading room. A back office is a part of most corporations where tasks dedicated to running the company itself take place.
Analysis of economic and political information with the objective of determining future movements in a financial market. In finance, a futures contract is a standardized contract between two parties to buy or sell a specified asset of standardized quantity and quality at a specified future date at a price agreed today the futures price.