A contract for difference (CFD) is a popular form of derivative trading. CFD trading enables you to speculate on the rising or falling prices of fast-moving global financial markets (or instruments) such as forex, Cryptocurrencies, indices, commodities, and shares without having to take ownership of the underlying assets.
Derivatives are financial products that derive their value from the price of an underlying asset. Derivatives are often used by traders as a device to speculate on the future price movements of an asset, whether that be up or down, without having to buy the asset itself.
A hedge is an investment or trade designed to reduce your existing exposure to risk. The process of reducing risk via investments is called 'hedging'.
Leverage is the ability to control a large position with a small amount of capital. It is usually denoted by
a ratio. For example, if your account has a leverage of 200:1, that means you can trade a position of $50,000 with only $250.
A long position that appreciates as price rises. When buying the base currency of a pair of currencies, the position held is a long position.
A lot is a standardized group of assets that are traded instead of a single asset.
A margin call is a term for when a broker requests an increase maintenance margin from a trader, in order to keep a leveraged trade open.
The difference between total open long and open short positions in a trading account.
A pip is actually an acronym for "percentage in point." A pip is the smallest price move that an exchange rate can make based on market convention.
A short position that benefits as the price declines. When selling a pair of base currencies, it is called a "short position."
When the price at which an order is executed does not match the price at which it was made, it is referred to as slippage. Generally attributed to changes in market conditions.
A tick is the smallest unit of price fluctuation.
A market’s volatility is its likelihood of making major, unforeseen short-term price movements at any given time.