Trading Glossary Explained

Trading is a complex process, which includes many actions that a person unfamiliar with the financial world will find puzzling. Once you launch your trading career, you will be swamped with trading terms whose meaning you will not know. You will not immediately grasp how the market value of a business differs from its book value. Nor will you understand what CPI stands for and how it is different from IPO, unless we supply you with a glossary of all confusing terms that you meet in a trading business.

To help you avoid confusion, we have compiled a comprehensive glossary of financial terms used at the markets. All trading glossary is presented in our glossary in the alphabetical order and is explained with linguistic precision. Any financial term that sounds baffling to you now will become crystal clear once you read its definition in our glossary below.

All | # 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

There are currently 9 names in this directory beginning with the letter A.

Accrual

It is an accounting term. It describes the method for recording revenues and expenses when they are incurred. It is not of no importance for this method of recording when cash is exchanged.

Acquisition

This term refers to a company’s takeover of another company. The acquiring company will take over another company by buying its ownership stake, whether the majority of it or its entirety.

Alert

Fibo alerts, also called trading alerts, allow traders to set specified criteria and be immediately notified once these criteria have been met. There are three types of alerts in trading: economic announcements, price alerts, and indicator alerts.

Amortization

It is the process of spreading the repayment of a loan or the coast of an intangible asset over a specified time frame. Banks or copyright agencies set the condition of the spreading the repayment, allowing for amortization for a number of months or years. Amortization usually incurs interest payments, set at the discretion of the lender.

Analyst

It is a financial professional who is qualified to evaluate investments and makes recommendations to sell, buy, or hold an asset.

Annual General Meeting (AGM)

It is a yearly gathering between a company’s shareholders and its board directors. It is the only time when shareholders and directors meet. At AGM, directors present the company’s annual report.

Appreciation

A product appreciates when its price goes up in response to market demand.

Arbitrage

It is a term related to trading. It is the practice of buying and selling an asset simultaneously to take advantage of a difference in price. The asset is usually sold in a different market, in a different form, or with a different financial product.

Asset

It is an economic resource that is owned or controlled to return a profit or a future benefit. In financial trading, the term relates to what is being exchanged on markets; that is, to stocks, bonds, currencies, and commodities.