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Glossary
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
ASK PRICE
The price offered for buying a particular financial instrument. The price, also called “offer price”, is a price which a seller is willing to accept for sale of the particular financial instrument.
BAR CHART
A type of chart providing a visual representation of the price activity of a financial instrument, over a given period of time. The chart consists of four significant points: the high (1) and the low (2) prices which form the vertical bar; the opening (3) price, which is marked with a small horizontal line to the left of the bar; and the closing (4) price, which is marked with a small horizontal line to the right of the bar.
BEAR MARKET
A market that is characterized by declining prices of a financial instrument.
BID PRICE
The price offered for selling a particular financial instrument, i.e the price at which a buyer is willing to pay for the particular financial instrument.
BROKER
A party that mediates between a buyer and a seller. A broker might act as a buyer or a seller and as such be a principal party to the deal.
BULL MARKET
A market that is characterized by rising market prices of a financial instrument.
BUSINESS INTRODUCER (BI)
A person (natural, legal person) who introduces clients to Windsor and receives commission in return for the services offered.
CLOSING PRICE
The last price of a financial instrument offered at the end of a trading session.
CONTRACT MONTH
The month in which a futures contract expires and during which delivery may take place, also called “delivery month”.
CONTRACT
The trading unit of financial instruments.
COUNTER-PARTY
Any person (natural person, legal person) entering a contract on the opposite side of the transaction. Each transaction must have counterparty or else the transaction cannot be executed. Counterparty can refer to brokers, investment banks, and other securities dealers that serve as the contracting party when completing "over the counter" transactions.
CROSS-RATE
A Forex currency pair where neither one of the currencies is U.S. dollar.
CURRENCY
A form of money; a unit of exchange used for facilitating the transfer of goods and/or services.
DAY TRADING
Buying and selling financial instrument within the same trading day.
DEALER
Any person (natural or legal person) acting as a principal or counterparty to a transaction.
EURO
The official currency of the European Union's (EU) member states. The euro is abbreviated by the symbol "EUR".
EUROPEAN CENTRAL BANK (ECB)
The Central Bank responsible for the monetary system of the European Union (EU) and the euro currency.
EXPIRATION DATE
The last day of trading for a Futures contract that will cease to exist.
FINANCIAL INSTRUMENT
Financial Instruments offered for trading by Windsor may be viewed under the Contract Specifications Table.
FOREIGN EXCHANGE MARKET (Forex / Fx)
The market where currency trading takes place. Markets where participants can purchase one currency in exchange for other. One of the largest and most liquid financial markets in the world.
FOREX (see Foreign Exchange Market)
An abbreviation of Foreign Exchange Market.
FUNDAMENTAL ANALYSIS
Performed on historical and present data with the goal of making financial forecasts.
FUTURES
A standardized contract, traded on a future exchange to buy or sell a specified financial instrument at a pre-determined price, at a future date.
FUTURE (OTC)
A standardized contract to buy or sell a financial instrument at a pre-determined price, at a future date, but not traded through an exchange; traded “Over-the-counter”.
FX (see Foreign Exchange Market)
An abbreviation for Foreign Exchange Market.
GTC (Good Till Cancelled) Order
An order to buy or sell a financial instrument at a specific price, valid until the order is completed or cancelled.
HEDGING
Strategy designed to minimize exposure of a risk. Attempt to reduce the exposure of the risk of the position by taking the position in the opposite direction.
INVESTOR
Individual or corporation that enters into financial markets in hope of achieving a financial gain.
LEVERAGE
The use of small initial investment, credit or borrowed funds as attempt to amplify the potential gains of an investment.
LIMIT ORDER
An order to buy or sell a financial instrument at a specific price.
LIQUID MARKET
Market with a high degree of liquidity, low spread, costs and volatility, often resulting from a large number of buyers and sellers.
LIQUIDATION
The closing of existing open positions through the execution of an offsetting transaction.
LONG (Long Position/Going Long)
A market position where an investor has bought a financial instrument with the intention of selling it back, at the later stage. The client “wins” when the price of the financial instrument increases and loses if the price decreases.
LOT
The term used to describe a designated number of contracts, e.g., a five lot purchase.
MARGIN REQUIREMENT
Minimum amount of funds required for each open position held open in client’s trading account, in accordance with the chosen leverage. These funds are considered as a guarantee and not a cost.
MARGIN CALL
It is a demand for additional funds in order for open positions, held by the client, to remain in the market.
MARKET MAKER
A person (natural, legal person) who is buying and selling financial instruments for his own account.
MARKET RISK
The financial risk related to the exposure of the investment, due to the uncertain moves in the market prices.
MINIMUM PRICE FLUCTUATION (TICK)
A minimum price fluctuation made by a financial instrument.
ONE CANCELS OTHER ORDER (OCO)
Execution of one order that automatically cancels the other. OCO order is a combination of a Stop Loss or a Take Profit; in cases where one of the two orders is executed, the cancellation of the second order is done automatically.
OPEN POSITION
A long or short position whose value is changing in accordance with change of the market price, of the financial instrument.
ORDER
An instruction for a transaction to be executed at a specific price. It is executed only when the market price reaches the price specified in the order. An order reflects investor/trader’s expectation at the time when the order was placed.
OVER-THE-COUNTER MARKET (OTC)
A negotiated market conducted between buyers and sellers. OTC are Financial instruments which might be listed on an exchange but are traded over the telephone, facsimile and/or electronic network instead of a physical trading floor. There is no central exchange or meeting place for this market.
PIP / POINT
Refers to a minimum price fluctuation of a financial instrument.
POSITION
A commitment; number of lots of a financial instrument bought or sold by a trader / investor. The buyer of financial instruments is carrying “long” positions while the seller of financial instruments is carrying “short” positions.
QUOTE
Refers to the bid or ask price of a financial instrument i.e price offered for selling and/or buying of a financial instrument, at the same moment.
RESISTANCE (Resistance Level)
The price level at which a financial instrument, during a certain period of time, has difficulties rising. Resistance level is the opposite of Support Level.
RISK
Uncertainty on return of an investment. Risk is the possibility of losing the money invested for trading in financial instruments.
ROLL OVERS
Forex currency pairs positions, held open at the end of the business day are rolled over on a daily basis until the value date is met; based on a Tom/Next basis. Currencies with the higher interest rates will receive interest payment through roll overs and vise versa, currencies with the lower interest rates will pay interest through roll overs charges.
SHORT (Short Position/Going Short)
It is a market position where an investor has sold a financial instrument with the intention of buying it back, at a later stage. The investor wins when the price of a financial instrument decreases and loses if the price increases.
SPECULATOR
A market participant (investor/trader) who wishes to profit by buying and/or selling a financial instrument, anticipating future price movements.
SPOT
Transaction in which one currency is exchanged directly for another, for the settlement date in two days forward.
SPREAD
The difference between the price offered for selling (bid) and the price offered for buying (ask) of a financial instrument.
STOP ORDER / STOP LOSS ORDER
An order to sell a financial instrument at a lower price than that of the market or buy a financial instrument at a higher level than that of the market. Stop orders are designed to limit a loss on open positions. When the level of the stop order is reached, the stop order becomes a market order (not limit).
SUPPORT or SUPPORT LEVEL
The price level at which a financial instrument, during a certain period of time, has difficulties to break below. That is the price level at which a financial instrument tends to stop falling due to more demand than supply.
TECHNICAL ANALYSIS
The way of predicting price changes of a financial instrument by analyzing prior price movements and looking for patterns and relationship in price history.
TICK (see Minimum price fluctuation)
A minimum price fluctuation of a financial instrument.
TOM NEXT (TOMORROW NEXT)
A trade that arises for the purpose of avoiding the actual delivery of the currency, traded by the speculators on Forex markets. In most cases, delivery is two days after the transaction date.
TREND
Trend is a general direction of the market of a certain financial instrument.
VALUE DATE
Each Forex transaction carries an assigned value date. The value date usually falls 2 business days after a transaction is executed. In cases where Forex currency pair position is opened and closed within the same day, the value dates will be the same and therefore the position will not be carried over into the next day and have the Tom Next charges applied.
VOLUME
The number of contracts made during a specified period of time as in an hour, day, week or year. For financial instruments that are traded in lots, the volume is reported to reflect that fact.
