The industry’s most important terms explained.

Discover a wealth of financial terms and definitions that every trader should know.

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Account balance

The account balance reflects the capital on your account excluding the profit/losses from your current open positions.

Account Equity

The equity reflects your balance + your floating profit /loss of your open positions.

At or Better

An order to deal at a specific rate or better.

At Best

An instruction given to a dealer to buy or sell at the best rate that can be obtained.

Ask (Offer) Price

The price at which the market is prepared to sell a specific Currency in a Foreign Exchange Contract or Cross Currency Contract. At this price, the trader can buy the base currency. In the quotation, it is shown on the right side of the quotation. For example, in the quote USD/CHF 1.4527/32, the ask price is 1.4532; meaning you can buy one US dollar for 1.4532 Swiss francs.

Arbitrage

The purchase or sale of an instrument and simultaneous taking of an equal and opposite position in a related market, in order to take advantage of small price differentials between markets.

Appreciation

A currency is said to ‘appreciate’ when it strengthens in price in response to market demand.