Let's continue to go over some words and terms used by traders.
- Commissions: In trading, we want to make money and so do the brokers. They will charge you a variety of fees based on what you want to trade and when. Commissions will vary from broker to broker and by the instruments, you want to trade. Exchanges will also come with fees on certain accounts, that go beyond regular transfer fees. Contact your broker for more information on your commission rate.
- Bid and Ask: The bid and ask are the order requests on both the buy and sell side of an instrument that you happen to be trading. The bid is where the buyer has their order where the ask is where the seller has entered their order. The difference here is called the spread.
- Spread: This is the difference in price between the bid and ask.
- Charting: This refers to an old style of trading and is apart of Pilot's algorithm. With Pilot Trading, you get all of the complex skills of an experienced trader, condensed into signals that give you the best opportunity to execute a trade.
- Hawks and Doves: The terms hawkish and bullish refer to the interpretation of an announcement or outlook on something specific or general. Feeling hawkish means you have an overall negative interpretation or attitude. Being dovish means a positive outlook.
- Risk Management: This term is straightforward and is in reference to one's tolerance to risk and reward. Each trader will have his or her own risk tolerance and this will determine their individual trading and risk management strategies.
- Security: in a financial context, is a certificate or other financial instrument that has monetary value and can be traded. Securities are generally classified as either equity securities, such as stocks and debt securities, such as bonds and debentures.
- Pip: A pip is a measurement of movement in forex trading, defined as the smallest move that a currency can make.
- Fill: When an order has been completed, it is often referred to as ‘filled’ or as the order having been executed. However, it is worth noting that there is no guarantee that every trade will become completely filled, this is known as a partial fill.
If you have also read the previous vocabulary articles then you have an intermediate comprehension of the lingo used by traders. For more market words and phrases just click here.