The required equity that an investor is required to keep on deposit to cover potential losses. If the margin requirement is 10% and a speculator wishes to buy $1 million EURO/USD, that speculator must have $100 thousand EUROS in value in his/her account.
The state of a trading account when the Client loses an opportunity to manage it. ln case of a margin call all the positions would be closed by the Broker on any immediate quotation. Margin call comes, when a Margin level reaches 30% and lower.
The principle of Margin trade is that the Client pays only a part of the transaction, the rest of the amount is provided by the Broker as credit.
A dealer who supplies prices and is prepared to buy or sell at those stated bid and ask prices.
An order to buy/sell at the best price available when the order reaches the market.
Marking to Market
Common valuation method for calculating ones foreign exchange exposure at current market prices. Adjusting book value of holdings to reflect current market value.
The rate at which a dealer is willing to sell a currency.
One Cancels the Other Order (OCO)
A designation for two orders whereby one part of the two orders is executed the other is automatically cancelled.
A deal not yet reversed or settled with a physical payment.
A request, from a Client to a Broker, that a trade should be made automatically when the exchange rate of the specified currency pair crosses a specified threshold. . An order can be placed at a specific price or at the market price.
A curve of temp, which fluctuates around the zero line (or between 0 and 100%), a technical indicator that shows the overbought or oversold market state.
Over-The-Counter Market (OTC)
A market, such as the FX market, in which counterparties trade via telephone, fax or electronic distribution network rather than from a physical exchange location.
A trade that remains open until the next business day.
The term used in currency market to represent the smallest incremental move an exchange rate can make. Usually it is the second or fourth decimal point, 0,01 or 0,0001 respectively.
The netted total holdings of a given currency. If the position is open, it is exposed to market risk. If a position is closed, profit/loss has been realized.
Gains exceeding over losses.
Often shortened to quote and also referred to as bid-asked. The highest bid or lowest offer price currently available on a security/commodity.
An indicative market price, normally used for information purposes only.