Trader’s Dictionary

A dictionary for traders and investors to guide them through the markets understanding traditional terminology and a glossary of modern terms from Meme stocks to Reddit threads and more.

0-9
A
ATH
All time high
ATM
At The Money – An option strike at the current market price of the underlying
Abandon
To elect not to exercise or offset a long option position
Adjustable Peg
An exchange rate system where a country’s exchange rate is “pegged” (i.e. fixed) in relation to another currency. The official rate may be changed from time to time.
Albatross Spread
The albatross spread is a complex options trading strategy that involves four separate transactions. Four Transactions (buying and writing puts or calls at different strikes). It’s a neutral strategy designed to generate a return when a security remains stable in price and can be used with put or call options. It is a debit Spread and is also known as a Wide Condor Spread.
All Or None Order
Order that must be either filled entirely or not at all. Often abbreviated as AON
Altcoins
Refers to cryptocurrency that isn’t Bitcoin. The two most paramount altcoins are Ethereum and Ripple. There are over 5,000 altcoins in existence with other common altcoins include Ether, XRP, Stellar, Monero, Ada, Doge, Shiba and Dash that are seen as major players in the crypto space.
American Option
An option that can be exercised at any time prior to or on the expiration date

Apes
Apes (gorilla emoji) refers to the community of apes as lowly retail investors.

Arbitrage
If performed correctly a risk-free type of trading where the same instrument is bought and sold simultaneously in two different markets in order to cash in on the difference in these markets.
Around
Used in quoting forward “premium / discount”, “three-three around” would mean three points on either side of the present spot value.
Asian Option
An exotic option whose payoff depends on the average price of the underlying asset during some portion of the life of the option
Ask Price
The price it costs to buy an instrument, such as an option, stock, bond or future.
Assignment
When the writer of a contract is required to fulfill their obligations under the terms of that contract. The underlying security if they have written calls or selling the underlying security if they have written puts. The writer will be issued with an assignment notice in such circumstances.
At Par Forward Spread
 When the forward price is equivalent to the spot price
At the Money Option
An option where the price of the underlying security is the same as the strike price.
Aussie
Market jargon used in the foreign exchange market for the Australian dollar. Aussie is traded heavily against the US dollar as AUDUSD, the yen AUDJPY and New Zealand dollar AUDNZD
Automatic Exercise
The process by which in the money options are automatically exercised if they are in the money at the point of expiration.
Average Directional Movement Index
The Average Directional Movement Index (ADX), is a technical analysis indicator by Welles Wilder, the ADX is one of the few technical tools that are directionally neutral. The ADX measures a trend’s force, without acknowledging its direction. The ADX has a minimum and maximum levels of 0 to 100 within which the main signal line fluctuates. Lower values indicate weak trends and higher values indicate stronger trends. Readings below 25 can signify a very choppy market, between 25 and 50 a medium strength trend, 50 to 75 a very strong trend, and the trend strength above 75 is considered dominant.
Ax
Someone who is controlling a stock, usually a market maker
B
BTC
Buy To Close
BTO
Buy To Open
Backwardation
Market situation in which futures prices are progressively lower in the distant delivery months. (Backwardation is the opposite of contango)
Bagholder
Someone stuck in a stock that’s priced lower than their entry cost
Balance-of-Payments (B.O.P.)
System of recording a country’s economic transactions
Bald Lines
Bald Lines are where the Wick is Missing at One End
#1 Long Red (White) Line – Extremely Strong Line
#2 Long Black Line – Extremely Weak Line
#3 Red (White) Opening Line – Strong Line — Indicates High Prices
#4 Black Opening Line – Weak Line — Indicates Low Prices
#5 Red (White) Closing Line – Strong Line — Indicates High Prices
# 6 Black Closing Line – Weak Line — Indicates Low Prices

Barrier Option
A type of exotic options contract hat can come into existence (life) or go out of existence based on specific criteria is usually related to the price of the underlying security. The barrier is a fixed price at which the contract is either activated or terminated, depending on the exact terms of the contract. Common types include:
Knock In and Knock Out
Up and In
Down and In
Up and Out
Down and Out
Double Barrier Options
Base Currency
In general refers to the currency that other currencies are quoted against. In the forex market the US Dollar is normally considered the base currency for quotes. Such quotes are expressed as a unit of $US1 per the other currency quoted in the pair. It also refers to the currency in which an investor or issuer maintains it’s book of accounts.
Basis
The difference between the spot price and the futures price.
Bear Butterfly Spread
The bear butterfly is designed to profit when the outlook on a security is bearish. There are three transactions involved in this strategy (buy puts/write puts/buy puts) and can be applied using either puts or calls for a comparable return. Debit Spread (Upfront Cost)
Bear Call Spread
Bearish Strategy with two transactions (write calls & buy calls). A credit spread (receive an upfront payment).
Bear Market
When the overall market is in decline.
Bear Put Ladder Spread
Bearish Strategy that is basically an extension of the bear put spread. This requires three transactions (buying puts & writing puts at different strikes) to create a debit spread or a Credit Spread. Used when the expectation is that the price of the security will not fall substantially. It’s also known as the long-put ladder spread and can result in big losses if the downward price movement is bigger than expected.
Bear Put Spread
Bearish strategy which involves two transactions, (buy puts & write puts) which are combined to create a debit spread (has an upfront cost). To use when speculating on a security going down in price.
Bear Ratio Spread
Bear Ratio Spread requires two transactions (buy puts & write puts) and can create either a debit spread or credit spread, depending on the ratio of options bought to options written. It is basically an advanced bear put spread. Unlike the bear put spread you don’t write the same number of options as you buy, you write a higher amount at a ratio that suits what it is you are trying to achieve. The bear ratio spread can be used to lower upfront costs (or even eliminate them) or to increase the potential profits if the underlying security falls to a specific price you have forecasted. Also known as Ratio Bear Spread, Ratio Put Spread
Bear Trap
When a market movement which suggests or traps you into a bear market strategy but ends up reversing moving upwards in price and traps you at low levels.
Bearish
An expectation that a market, an option, or any financial instrument, will decrease in price.
Bearish Trading Strategies
Strategies that can be used to profit from a downward move in the price of a financial instrument. You can use bearish futures or options trading strategies, you can have protected or unprotected positions, risk management is critical in trading strategies. You can be short the instrument such as futures or the option or stock. If you have a long only strategy you could be simply not long as a bearish play.
Some bearish option strategies: Long Put, Short Call, Bear Put Spread, Bear Call Spread
Bear Ratio Spread, Short Bear Ratio Spread, Bear Butterfly Spread, Bear Put Ladder Spread
Bid Ask Spread
The difference between the bid price and the ask price of a financial instrument. An indicator of liquidity, and often referred to as the spread.
Bid Price
The price that a buyer is showing he is willing to buy at or bidding for.
Binary Option
Binary options are defined by one specific feature; they pay out a fixed return to the holder if they are making a profit by the time of expiration, regardless of how much profit they have gained. They are called binary options simply because there are two possible outcomes – the holder either gets the fixed pay out or loses their initial investment. Also known by a number of different names such as all-or-nothing, digital, or even fixed return options
Binomial Options Pricing Model
Abbreviated to BOPM; a pricing model that was developed by Cox, Ross and Rubinstein in 1979. The name stems from it calculating two possible values for an option at any given time. The binomial model calculates how the theoretical value of an option will change as time moves on and the price of the underlying security moves up or down.
Bitcoin
Bitcoin is the largest and world’s first digital currency launched back in 2009 by the illusive if not mythical, Satoshi Nakamoto. It is the most popular and largest cryptocurrency in terms of market cap in the world. Bitcoins represent pieces of digital code that can be sent and received across a kind of distributed ledger network called a blockchain. Given the code structure there will only ever be 21 million Bitcoins in existence. By 2020, there were already 18.3 million Bitcoins in circulation.
Black Scholes Options Pricing Model
An options pricing model that is based on a mathematical formula and that formula uses a number of variables or inputs to calculate a fair value for an option that include the strike price, the price of the underlying security, the length of time until expiration, and volatility. 
Book
In a professional trading environment, a book is the summary of a trader’s or a desk’s total positions.
Box Spread
Box spread involves four separate transactions, a combination of a conversion strategy and a reversal strategy but without the need for the long stock positions and the short stock positions. It is in essence a combination of a bull call spread and a bear put spread.
The box spread is also commonly referred to as the alligator spread, because the chances are that the commissions involved in making the necessary transactions will gobble up any of the theoretical profits that can be made.
Bradley Turn Dates
Donald Bradley wrote “Stock Market PredictionThe Planetary Barometer and How to Use It.” in 1948 With a tool known as the Bradley Siderograph (star graph) Donald Bradley’s siderograph is based on major planetary aspects and the declinations of Mars and Venus.  The siderograph assigns varying weights to each planetary aspect depending on its exactness which is intended to leverage “the potency of major planetary aspects…to prove the correspondence between planetary operations and market responses.”  The siderograph is typically used to identify turning points or inversions (i.e., trend reversals) in the market over the medium to long term market turning points within 4-7 calendar days rather than being exact to the day of the turning point.

Bretton Woods Accord of 1944
An agreement that established fixed foreign exchange rates for major currencies, provided for central bank intervention in the currency markets. Alternative A, p. 16 submitted by the American delegate provided that ’The par value of the currency of each member shall be expressed in terms of gold, as a common denominator, or in terms of a gold-convertible currency unit of the weight and fineness in effect on July 1, 1944’. Subsequently the price of gold was set at US$35 per ounce. This was known as the ’Gold Fix’ and ’Gold Standard’ which was removed in 1971 for free floating exchange rates.
Bull Butterfly Spread
This is a strategy that can be used when the outlook on an underlying security is bullish. The bull butterfly spread is similar to the basic butterfly spread, which is used to try and profit from a neutral outlook, but with an adjustment to the strikes to transform it into a bullish strategy. It’s a complex strategy that involves Three Transactions (buy calls /write calls/buy calls) but it does have a relatively low upfront cost.
Bull Call Ladder Spread
This is a strategy that can be used when the outlook on an underlying security is bullish. The bull call ladder spread involves an extra transaction that further reduces the upfront cost of implementing the strategy. Three Transactions (buying calls & writing calls at different strikes) can be a Debit Spread or a Credit Spread
Bundesbank
The Central Bank of Germany
Butterfly Spread
A three-legged option spread in which each leg has the same expiration date but different strike prices. For example, a butterfly spread in natural gas call options might consist of one long call at a $5.00 strike price, two short calls at a $6.00 strike price, and one long call at a $6.50 strike price.
Buy To Open Order
An order that is placed when you want to open a new position through buying contracts, stocks or other financial instruments.
Buy to Close Order
An order that is placed when you want to close an existing short position through buying contracts that you have previously written or short of.
Buying Selling customs
Buying and selling in the foreign exchange market always happens in the currency that is quoted first. “Buy dollar/mark” means buy the dollar/sell the mark. Traders buy when they expect a currency’s value to rise and sell when they expect a currency to fall.
C
COT
The Commitment of Traders (commonly referred to as the COT) report has been published by the Commodity Futures Trading Commission since 1962 and provides information on the open interest in a multitude of commodity, currency, and stock index futures.
Cable
Market jargon used in the foreign exchange market for the British Pound. Purportedly from the telegraph cable under the Atlantic between the UK and the USA. The Pound trades against the US dollar as USDGBP and the Euro as Euro Pound. The pound’s official name is Sterling.
Calendar Call Spread
The calendar call spread is a neutral options trading strategy. It involves two transactions: buying calls and writing calls with the same underlying security and establishing it incurs an upfront cost. Debit Spread (upfront cost)
Calendar Straddle
The calendar straddle involves four transactions (write calls/write puts /buy calls/buy puts). It’s a neutral strategy, because it can profit from a lack of short-term price movement in a security but also designed to also have the potential to profit from longer term volatility.
It’s essentially a combination of two other trading strategies: the short straddle and the long straddle. Debit Spread (upfront cost)
Calendar Strangle
The calendar strangle involves four transactions (write calls/write puts/buy calls/buy calls). It is basically a combination of two other strategies (the short strangle and the long strangle) that is designed to profit from the price of a security remaining very steady in the short term, with the potential to profit from sizable price movements in the longer term. Debit Spread (upfront cost)
Call
In options is the shortened name for a Call Option. Call is often used instead of the full term.
Call Option
A type of option which grants the holder the right, but not the obligation, to buy the relevant underlying security at an agreed strike price at some point either before the contract expires, or at the expiration date. You would buy a call if you believe the price of the underlying security was likely to rise. You can also choose to sell calls if you felt the price would fall.
Call Ratio Backspread
A bullish strategy with a big price movement in either direction, the potential profits from an upward movement are unlimited, while the potential profits from a downward movement are limited. Two Transactions (buy call options and write call options) Credit Spread (upfront credit received)
Call Ratio Spread
Generally considered a neutral strategy, because it’s typically used when the expectation is that the price of a security is stable in a range. Two Transactions (buy calls and write calls).
It can potentially return a profit in three different scenarios; if the price of the security goes up a little, goes down, or stays the same. Credit Spread (upfront credit received)
Candlestick charts
Designed by Muneshia Homma in 1724 for the rice market in Japan.
There are Nine Daily Lines: # 1 Long White Line # 2 Long Black Line # 3 Short White Line # 4 Short Black Line # 5 White Upper Shadow # 6 Black Upper Shadow # 7 White Lower Shadow # 8 Black Lower Shadow # 9 Doji Line with a number of patterns and interactions for those lines with different meaning

Carrying Cost
The implied cost of using capital to purchase and hold financial instruments based on interest incurred from borrowing that capital or interest lost from not using that capital to receive interest.
Cash Settled Option
Cash settled options have a specific feature related to the way they are settled. When a cash settled option is exercised the writer of the contract pays any profit due to the holder in cash rather than any asset transfer taking place. It is a financial settlement rather than an exchange of an asset. Examples include natural gas or cattle cash versus physical settlement.
Cash Settlement
A procedure for settling futures contracts where the cash difference between the future and current market price is paid instead of physical delivery.
Central Bank
A Government or quasi-Governmental organization that manages a country’s monetary policy and oversees functions such as currency float management, employment protection and banking laws and regulations. Each country has different roles for their central bank. Key central banks include The Federal Reserve (USA), ECB (European Union), BOE (Bank of England), BOJ (Bank of Japan), RBA (Australia).
Chikou Span
Ichimoku element (Lagging line) represents the asset or index closing price for the last 26 days. The glance view shows how the price will compare to 26 days prior. An upward trend may be indicated if the Chikou Span is above closing price, and downward motion is signaled when the price is below it. Chikou Span is useful in confirming trends, momentum, and support and resistance that other Ichimoku elements may have uncovered. 
Chooser Option
A type of option that allows the holder to choose whether it’s a call or a put at some point during the term of the contract.
Chunnel
Market jargon used in the foreign exchange market for the British Pound rate against the Euro from the Euro tunnel under the English channel it is traded as EURGBP.
Close
The time or point at the end of a trading day when the market closes and final prices are calculated.
Closing Order
An order which is used to close an existing position. See Buy To Close Order or Sell To Close Order. You may also use a MOC order, which means closing the trade at the market close.
Combination Order
A type of order that combines multiple orders into one. Often involves an if done instruction, it can be part of a basket order.
Commodity Option
A type of option where the underlying security is either a physical commodity or a commodity futures contract.
Compound Option
A type of option where the underlying security is another contract.
Condor Spread
A neutral options trading strategy that is designed to profit when the price of a security stays with a defined range. It has four legs involved, (buying and writing call or put options at different strike prices). It can be created as a call condor spread, using calls, or a put condor spread, using puts. Debit Spread (upfront cost)
Contagion
Popularized in 1997 with the Asian markets financial crisis which triggered a domino affect throughout world markets. Thus it has come to refer to the inter-market reflexibility and interaction from one market to another. Initially it referred to the tendency of an economic crisis to spread from one market to another and has come to symbolize all market inter-relations not just currencies.

For example an earthquake in Taiwan may affect Taiwan Semi Conductor (TSM) which may affect the Semi Conductor Index which in turn will affect Intel-which affects the S&P; 500, the Dow Jones Industrials and Nasdaq. This may then affect the US Dollar and so on! To recap on the Asian Crisis of 1997, financial instability in Thailand caused high volatility in its domestic currency, the Baht, which triggered a contagion into the other so called Tiger Economies of East Asia and their currencies. This affect flowed onto Latin America. It is now referred to as the Asian Contagion
Contingent Order
A type of order that allows for the trader to set specific parameters for exiting a position.
Contract
Also Unit or Lot, whatever is the standard unit of trading on exchanges or OTC markets

Contract Neutral Hedging
Hedging that involves a trader buying as many options as units of the underlying security they own.
Contract Range
The price range between the highest and lowest price that an option or futures contract has been traded at.
Contract Size
The number of units of the underlying security that are covered by a contract. Prices are displayed based on one unit of underlying security; the price will usually specify the volume available at that price.
Conversion & Reversal Arbitrage
Conversion and reversal arbitrage are strategies that use synthetic positions to take advantage of inconsistencies in put call parity to make profits where price discrepancies between a position and the corresponding synthetic position may exist.
Corrective Wave
In Elliott Wave Theory there are 11 different corrective complexities. Corrective mode is employed by all countertrend interruptions, which include waves 2 and 4 and B. Their structures are called “corrective” because they can accomplish only a partial retracement, or “correction,” of the progress achieved by any preceding motive wave.
Cost of Carry
The cost associated with borrowing money in order to maintain a position based on the interest parity.
Covered Call
The covered call is an options trading strategy that is used when you have an existing long position on a bond, stock or future and you write call options based on the instrument that you own. One Transaction (write calls).
Covered Put
The covered put is a trading strategy that uses options to bring in income (or premium) against an existing short position in a bond, stock or future. One Transaction (write puts)
Credit Spread
A spread that is cash positive, you receive more for writing the options involved in the spread position.
Cross Rates
The exchange rate between two currencies. For example; AUD/JPY, GBP/CHF and CHF/JPY.
Cryptocurrencies
Cryptocurrencies represent digital currencies built on blockchain technology. These can be obtained using cryptography or virtual currencies. Such digital currency stems from encryption techniques that are employed to secure the networks which are used to authenticate blockchain technology. Cryptocurrencies can also accept online payments which are denoted as “tokens.” In 2009 Bitcoin became the first blockchain-based cryptocurrency and has since risen to become the world’s most widely traded and valued cryptocurrency. Other cryptocurrencies are Ethereum, Ripple, Stellar, and Dash, among many others.
Cubits
Somebody who is habitually slow and stupid or so disorganized that he causes considerable inconvenience to others. Variations include Dumb Cubits, Dopey Cubits & Silly Cubits
Currency Option
A type of option where the underlying security is a specific currency.
Currency Risk
The risk of incurring losses resulting from an adverse change in exchange rates.
D
DC
A trader that has no idea
DD
Due diligence
DK
A trader who is constantly changing his mind.
Day Order
A type of order that is cancelled at the end of a trading day if it hasn’t been filled. The order will automatically expire at market close if it has not been filled.
Day Trader
A trader who enters and exits their trading positions within one trading day, often holding onto positions for very short times and price movements.
Day Trading
Day trading is a style used for trading financial markets, including stocks, forex, and futures as well as options.
Debit Spread
A type of spread that is cash negative  i.e. you spend more on buying the options involved in the spread that you receive for writing the options involved in the spread.
Deep Pegging
When a trader buys an option with very wide spreads and is unable to exit profitably
Delta Neutral Hedging
Strategies designed to create positions that are not likely to be affected by small movements in the price of a security. This is achieved by measuring and protecting the overall delta value of a position is as close to zero as possible. The delta value of an option is a measure of how much the price of an option will change when the price of the underlying security changes. The delta value of an options position can change as the price of an underlying security changes.
Delta Neutral Trading
A strategy designed to create trading positions which will neither profit nor loss if there are small movements in the price of the underlying stock. The aim is to profit when the price of the underlying security moves significantly in either direction.
Delta Value
Options Delta is one of the option ‘Greeks’ that indicates how sensitive an option is to changes in the price of the underlying security. In simple terms, it will tell you in theory, how much the price of an option will move in relation to each $1 (or instrument basis) movement in the price of the underlying asset. The delta value of an option is usually expressed as a number between -1 and 1, although it can also be between -100 and 100.  An option with high delta will move in price significantly in proportion to the price movements of the underlying security, while one with low delta will move less often.
Derivatives
This refers to derived trades from a ’cash’ security or definable ’real asset’. Instruments are constructed or derived off assets such as an equity, bond, currency, or commodity. Derivatives can be both exchange and non-exchange traded (OTC). Derivative instruments include Futures, Options, Interest Rate Swaps, Forward Rate Agreements, Caps and Floors.
Diagonal Option Spread
Diagonal spreads consist of similar options contracts in that they must be of the same type and based on the same underlying security, but the contracts involved have different expiration months and different strike prices. Diagonal spreads are essentially a combination of vertical and horizontal spreads. To create a diagonal spread you need to use two different types of options order: the sell to open order to write options contracts, and the buy to open order to purchase options contracts. Diagonal spreads are also a form of calendar spreads. However not all calendar spreads are diagonal.
Diamond hands
Never selling and keep holding. Unclear what the exit strategy is for this. (Diamond and hands up emojis)
Directional Outlook
The expectation of which direction the price of a security will move in.
Directional Risk
The risk of loss from the price of a security moving in an unfavorable direction.
Discount Option
An option that is trading for less than its intrinsic value.
Discount Rate
The interest rate at which eligible depository institutions may borrow funds directly from their respective Central Bank. In the U.S. there are regional Federal Reserve Banks for this purpose where the rate is decided by the Federal Open Market Committee (FOMC) of the the Federal Reserve.
Dividend
A payment made by a company to its shareholders, there can be different type of dividends and can be paid at different times such as quarterly, annual or as special dividends. It is a reward or income for your asset.
Doing an Alain
A chemically prepared trader that jumps between stocks, lets profits become losses and is renowned as a bag holder


Doji
 A doji candle stick has a long upper wick or lower wick.  The wick refers to the high or low of day.  The body of a doji is smaller than the candle wick which tells us the open and close price were fairly close together. 
Doji Lines
#1 Doji – Turning Point; Slightly Bearish
#2 Long-legged Doji Rickshaw Man – Turning Point if Both Shadows are Long and Equal in Length
#3 Doji – Turning Point; Slightly Bullish
#4 Dragonfly Doji – Turning Point in the Market
#5 Gravestone Doji – Either a Turn in the Market or a Stable Market
#6 Four-Price Doji – Possible Turning Point; the Market is Unsure

Donkey Punched
When you buy a stock or future and you immediately take a massive loss that you never saw coming
E
ER
Earnings Report, which can lead the investor to visit the Emergency Room 🙂
Early Assignment
When the writer of options or futures contracts is required to fulfill their obligations under the terms of those contracts prior to the expiration date; early assignment happens when contracts are exercised early.
Early Exercise
When an American style is exercised prior to the expiration date.
Economic Indicators
These are statistics that indicate current economic conditions. They can by issued by Government, Quasi-Government or an academic or commercial institution. Examples are CPI, PPI, Gross Domestic Product (GDP), Unemployment, Balance of Payments, Industrial Production, Business Inventories and Retail Sales.
Economic and Monetary Union (EMU)
The irrevocable fixing of exchange rates between member currencies and their replacement by a single European currency, the euro. The euro is issued by the European Central Bank (ECB), independent of political control and federal in nature. All countries included fulfilled five convergence criteria set in 1998.
Elliot Wave Principle
A system developed by Ralph Elliott taking into account sentiments and patterns of empirically derived rules for interpreting action in the markets. It refers to a five-wave/three-wave pattern, which forms one complete bull market /bear market cycle of eight waves.
End of Day Book 
End Of Day or Mark to Market – Traders account for their positions in two ways: accrual or mark-to-market. An accrual system accounts only for cash flows when they occur; hence, it only shows a profit or loss when realized. The mark-to-market method values the trader’s book at the end of each working day using the closing market rates or revaluation rates. Any profit or loss is booked and the trader will start the next day with a net position.
Ethereum
Ethereum is an alt coin. It is a decentralized, open source, blockchain-based distributed computing platform and operating system. A defining feature of Ethereum is its smart contract functionality, making it extremely popular. Ethereum began in 2014 and has grown to the second largest cryptocurrency by market cap.
Euro
The currency of the European Monetary Union (EMU) which replaced the European Currency Unit (ECU)
Eurodollars
U.S. dollar deposits placed with banks outside the U.S. Holders may include individuals, companies, banks, and central banks.
European Central Bank (ECB)
The Central Bank for the European Monetary Union.
European Option
An option that may be exercised on the expiration date

Evening Southern Cross
Candlesticks (Hoshi)  A three-period pattern formed when the middle candle is a Doji, the pattern is called a “Evening Southern Cross”.

Evening Star
Candlesticks (Hoshi)  “Evening Star” is a three-period pattern formed when the middle period has a window between the real bodies of the first and third candles in the formation. This is analogous to an “island top” in conventional charting. If the middle candle is a Doji, the pattern is called a “Evening Southern Cross”. If the middle candle is a small inverted Hammer, the pattern is called a “Shooting Star”.

Exercise
When the option holder of the underlying security chooses to enforce their right under the terms of the contract, they are said to be exercising their option.
Exercise Limit
 A limit on the number of options that can be exercised that may be imposed on the holder.
Expanded Flat or Irregular Flat 
In Elliott Wave Theory an Expanded Flat or Irregular Flat is composed of five waves, which have an internal structure of 3-3-5.
Expiration Date
The date on which a futures, option or warrant contract expires and effectively ceases to exist. Options must be exercised on or before this date, or they will expire worthless.
Expire Worthless
When an option or warrant contract reaches the expiration date and has no value, meaning it it’s either at the money or out of the money at the point of expiration.
Extrinsic Value
The extrinsic value of an options contract is the less tangible component of price. It refers to factors other than the price of the underlying security and can also be known as premium value. Extrinsic value is referred to as the true cost of owning an option, because any intrinsic value that you pay for is already reflected in the current theoretical profit of the contract. The extrinsic value is sometimes known as time value is because one of the main factors which affect the extrinsic value of an options contract is the time left until it expires. The Theta of the option pricing.
F
FOK
Fill or Kill, you get your entire order filled or the order won’t fill at all to prevent partial orders.
Federal Reserve (Fed)
The Central Bank of the United States
Fibonacci
A number sequence discovered by thirteenth century Italian mathematician Leonardo Fibonacci (circa 1170-1250) in which the sum of any two consecutive numbers equals the next highest number—i.e., following this sequence: 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, and so on. The ratio of any number to its next highest number approaches 0.618 after the first four numbers. These numbers are used by technical analysts to determine price objectives from percentage retracements and extensions.
Fiduciary Call
When you buy at the money calls on a stock and then invest the balance of the capital that would be required if you were actually buying the stock and putting it into a risk-free interest-bearing account. Similar to long call, in that the only transaction involved is buying call options. It is used as an alternative to buying stock, essentially to reduce the costs involved in buying and exercising call options instead of buying stock.
Fill or Kill Order
Often abbreviated to FOK, this is a type of order that must be either completely filled with immediate effect or cancelled.
Financial Instrument
A real or virtual asset that has an inherent monetary value and/or transfers monetary value. Equities, options, currencies, futures, digital assets, currencies and commodities are all forms of financial instruments.
Flat
To be neither long nor short is the same as to be flat or square. One would have a flat book if he/she has no positions or if all the positions cancel each other out.
Flat Pattern
Flats are very common forms of corrective patterns, which generally show a sideways direction. Waves A and B of the Flat are both corrective patterns. Wave C on the contrary is an impulsive pattern.
Forward
A deal struck for delivery at an agreed date in the future different from spot delivery. Forward trades in FX are usually expressed as a margin above (premium) or below (discount) the spot rate. To obtain the actual forward FX price, one adds the margin to the spot rate. The rate will reflect what the FX rate has to be at the forward date so that if funds were re-exchanged at that rate there would be no profit or loss (i.e. a neutral trade). The rate is calculated from the relevant deposit rates in the 2 underlying currencies and the spot FX rate. As the primary purpose for Foreign Exchange was to facilitate foreign trade, unlike in the futures market with fixed expiration, forward trading can be customized according to the needs of importers and exporters and involves more flexibility.
Forward Points
The pips added to or subtracted from the current exchange rate to calculate a forward price.


Full Service Broker
A type of broker that offers expert advice and professional guidance in addition to executing orders for a client; they typically charge higher fees and commissions. A comparison would be a discount broker who provides just execution capability and nothing more.
Fundamental Analysis
The analyze of the value of a financial instrument by specific factors that relate to the true value of that security such as contracts, risk, balance sheets, assets, history and income statements.
Futures Option
A type of option where the underlying security is a future contract.
G
G5
The five leading industrial countries: The United States, Germany, Japan, France and the United Kingdom.
G7
The seven leading industrial countries: The United States, Germany, Japan, France, United Kingdom, Canada, and Italy.
G7 (G8)
Regular meetings of G-7 finance ministers and central bank governors were instituted at the 1986 G-7 Leaders’ Summit in Tokyo. The purpose of doing this was to improve communication and cooperation on matters that fall under the mandate of finance ministers and central bank governors, including economic and financial growth and stability, inflation and currency developments. It was at the Tokyo Summit that Canadian and Italian finance ministers were invited to join ministers from France, Germany, Japan, the United States and the United Kingdom, who had already been meeting as a group for some time

In 1997 the Leaders’ Summit became known as the G-8 to reflect Russia’s participation. Russia does not participate in the G-8 chair rotation, and is not a full member of the G-7 finance ministers’ process, although it does take part in some meetings of G-7 finance ministers, primarily in discussions concerning the Russian economy. Recently Russia has also participated in G-7 discussions on ways to combat the financing of terrorism.

Until 1998 G-8 foreign ministers and G-7 finance ministers met in conjunction with G-8 Summits. At the Birmingham Summit in 1998, the G-8 introduced the “leaders only”; format, with foreign ministers and finance ministers meeting separately in advance of the Summit.
GTC
Good Till Cancelled.  That means the order will stay on the brokers servers until you cancel it. Often jokingly called Good Till Close with traders tendency to change orders when price gets close.
Gambler
Iconic song from Kenny Rogers often known as a trader’s lament

The Gambler – Kenny Rogers

“If you’re gonna play the game, boy
You gotta learn to play it right”

You got to know when to hold ’em
Know when to fold ’em
Know when to walk away
And know when to run
You never count your money
When you’re sitting at the table
There’ll be time enough for counting
When the dealing’s done

“Every gambler knows
That the secret to surviving
Is knowing what to throw away
Knowing what to keep
‘Cause every hand’s a winner
And every hand’s a loser
And the best that you can hope for
Is to die in your sleep”
Gamma Neutral Hedging
Hedging technique that creates positions where the overall gamma value is as close to zero as possible so that the delta value of the positions should remain static whether or not the price of the underlying security moves up or down. The gamma value of an options position essentially represents the volatility of that position. Creating a gamma neutral position is to be exposed to as little volatility as possible.
Gamma Value
The gamma value measures the theoretical effect of changes in the price of the underlying security on the delta value of that option. The delta value of an option indicates the theoretical price movement of an option as the price of the underlying security moves, while the gamma value indicates the theoretical movement of the delta value as the price of the underlying security moves.
Gann
Gann’s theory represents geometric technical analysis based on time and price. Developed by William Delbert Gann (1878-1955). W.D. Gann’s uses Natural Law and geometric proportions based on the circle, square, and triangle to mathematically calculate using price, price range and time as inputs. Gann’s theory analyzes trading markets’ cyclical nature or Seasonality. Gann says that there can be nine mathematical proofs of any point of resistance
Gann Wheel
The Square of Nine, also called a “Square Root Calculator” that “Squares the Circle.” W.D. Gann says that 90 degrees in very important in the stock market. Adding and subtracting .5 (and exact multiples or proportions of .5) to the square root of a stock price and then squaring the result is very important. The Square of Nine is totally indifferent to whether the input variable is a price, a range of prices, or a number of trading days or calendar days. They are all the same and completely interchangeable and Gann looked at the orbital relationship. Are they in opposition, conjunction or square?
Gary
The index options market maker collective
Gatlin Boys
Pump and dumpers
Gideon
A megalomaniac trader with a very exaggerated self-image; who consider themselves powerful and important, if not bigger than the market. They exaggerate their abilities and dramatize their achievements, They feel indestructible, They don’t admit to their mistakes, so they never learn from them. Hyperawareness of people’s reaction to what they do or say. If they lose they think the market is the problem and not them.

Globalization
As the 20th century drew to a close the deterritorialization of money (Cohen 1998) occurred rapidly. What this meant was that since the removal of Foreign Exchange controls the circulation of sovereign currencies was no longer confined within the territorial frontiers of nation-states. Competition and technological innovation, national financial and monetary systems have become increasingly integrated, effectively widening the array of currency choice for many transactors and investors. As a result, strictly territorial currencies are fast disappearing in most parts of the world. Today, as we enter the twenty-first century, money is becoming increasingly deterritorialized.
Globex
An electronic platform for global after hours electronic trading in futures and options developed by Reuters for the CME and the CBOT for use in conjunction with various exchanges around the world.
Going Long
Going long is when you buy a financial instrument with the expectation that it will increase in price over time. Also, you may hear the term adding length.
Going Short
Going short on a financial instrument is with the expectation that it will decrease in price. Writing a contract is going short on that option.
Gold Standard
The original system for supporting the value of currency issued. The price of gold was fixed against the currency as such it was not the supply and demand of Gold itself that determined the price of gold.
Good Until Cancelled
Abbreviated to GTC, a type of order that stays active until it is either filled or cancelled.
Greeks
Greeks refers to the values used in options as they use Greek titles. Greeks include Delta, Theta, Gamma, Vega and Rho. They are used to measure the sensitivity of an option to changes in market conditions and the theoretical changes in the price of an option caused by specific factors such as the price of the underlying security, volatility, and time left until expiry.
H
HOD
High of day
HODL
Hold On for Dear Life, Hold the line, asking people to not sell and believe in the long term growth.
Harami
Harami Pattern is an Inside Day. When a line with little or no movement is unable to move above or below the previous day’s line, it is called a “Harami line” If the previous line was a red (white) line in a rising market (Candles #1 and #2), the probabilities of hitting a ceiling are extremely strong. If the Harami line is also a Doji line, it is especially helpful. The Doji form of the Harami line (Candles #5 and #6) tends to form at a very high ceiling. The other Doji form (Candles #7 and #8) tend to form at a support area.

Hedge
An investment position or combination of positions that reduces the volatility of an asset class or portfolio’s value. One can take an offsetting position in a related security. Instruments used are varied and include forwards, futures, options, and combinations of all of them.
Hedge Ratio
The number of futures or options required to hedge a given exposure to the cash market.
Historical Volatility
Abbreviated to HV, a measure of the volatility of the price a financial instrument over a specified period of time in the past.
Holder
The owner of securities or options contracts.
Horizontal Spread
Horizontal spreads consist of options contracts of the same type, on the same underlying security, and the same strike price: but they have different expiration months. Horizontal spreads are also calendar spreads. A horizontal spread is created by writing options contracts of a particular type and buying contract of the same type but with different expiration months.
I
IMF
International Monetary Fund, was established in 1946 to provide international liquidity on a short and medium term basis. They also encourage liberalization of exchange rates. The IMF supports countries with balance of payments problems with the provision of loans. It was formed with the axiom that governments would not tolerate prolonged and widespread unemployment any more. A revival of international trade after World War II was indispensable if full employment was to be achieved in a peaceful world, and with standards of living which will permit the “realization of men’s reasonable hopes’.
ITM
In The Money – An option strike in the money of the current market price of the underlying
Ichimoku
Ichimoku Kinko Hyo, Ichimoku Clouds represent a Japanese technical charting system. Ichimoku “at first glance”, Kinko “balance or equilibrium”, Hyo “graphical representation or chart”  Charts have 5 different elements that are viewed together to provide one overall perspective on the current situation of an asset or index. Senkou Span A & Senkou Span B, Tenkan Sen, Kijun Sen, Kumo, Chikou Span
Immediate or Cancel Order
Abbreviated to IOC is a type of order that must be partially or completely filled immediately or cancelled. If the order is only partially completed, the balance of the order is cancelled.
Implied Volatility
Abbreviated to IV is a measure of the estimated volatility of the price a financial instrument at the current time.
Impulse Waves
In Elliott Wave Theory Impulse patterns are emotive waves and occur in waves 1, 3, 5 and in waves A and C of a correction( this correction could be a wave 2, 4 or a wave B, D, E or wave X).
The internal structure of these waves is 5-3-5-3-5. Note that the mentioned 3s are corrective waves, which should be composed of 5 waves in a corrective triangle.
In the Money Option
Option where the price of the underlying security has intrinsic value as the price of the security is in a favorable position relative to the strike price. A call is in the money when the price of the underlying security is higher than the strike price and a put is in the money when the price of the underlying security is lower than the strike price.
Index Option
A type of option where the underlying security is an index, such as the S & P 500, Nasdaq 100 or DAX.
Indicative Quote
A market maker’s quote, which is not firm – just an indication of where the market is trading at.
Interbank Rates
The Foreign Exchange rates at which Money Center or large international banks quote other Money center and large international banks directly.
Intrinsic Value
The portion of an option price when it’s in the money, the amount of theoretical profit that could be realized by exercising the option relative to the market price.
Iron Albatross Spread
This strategy is also known as the wide iron condor spread. There are four transactions involved it’s essentially the same as the iron condor spread, but it uses strikes that are further apart. Here the four legs are transacted using options that are further out of the money than in the iron condor spread.
Iron Butterfly Spread
A neutral options trading strategy that should be used when your expectation is that the price of a security will stay relatively stable. Credit Spread (upfront credit received). There are total of four legs in the spread and both calls and puts are used (buy calls/write calls/buy puts/write puts).
Iron Condor Spread
Neutral Strategy similar to the iron butterfly spread. Whereas the iron butterfly spread requires the underlying security to be at an exact price for the maximum return, the iron condor spread will return maximum profit providing the underlying security is within a specified range. The trade-off is the maximum profit is lower. Four Transactions (buy calls /write calls /buy puts /write puts). Credit Spread (upfront credit received).
J
J Curve
A term describing the expected effect of devaluation on a country’s trade balance. It is anticipated that import bills rise before export orders and receipts increase.
Jawboning
Announcements and statements by politicians or monetary authorities to influence or manipulate decisions. It may be directed towards the corporate world, other countries, consumers, lobby groups, trade unions or any influential or key sectors.
Judas
Someone who says, “Trading is not a team sport.”
Jurisdiction Risk
This refers to risk inherent in placing funds in a Center where they will be under the jurisdiction of a foreign legal authority. Also refers to the risks in having a contract or agreement or indeed in making a loan subject to the laws of another country.
K
KYS
Keep Yourself Safe, take your money off the table
Kabuse Line
Is the “Dark Cloud Cover”, a two-period pattern which occurs when a red (white) line is followed by a black line which has a higher price than the red line and which closes inside the body of the red line.
This is a bearish formation which indicates that the bulls are unable to sustain the upward momentum, and the bears are taking control.
In a rising market, the “Kabuse Line” usually appears near the ceiling.


Kijun Sen
Ichimoku element (Standard line) the second moving average in Ichimoku Cloud charting. Measures the highest high and the lowest low for the last 26 trading days. Kijun Sen may also be called the baseline, used in tandem with Tenkan Sen to measure momentum.
Kirikomi Line
The “Piercing Pattern” is a 2-period pattern which is basically the opposite of the “Dark Cloud Cover” (Kabuse Line). The black line of this pattern often occurs on Friday (market close); the bullish red (white) line then occurs on the following Monday. This pattern may occur during a break in the market. The “Kirikomi Line” rarely appears at a market bottom. At a bottom, the price movement can be fairly stable for a long period of time.

Kiwi
Market jargon used in the foreign exchange market for the New Zealand and is traded mainly against the US dollar as NZDUSD, the yen NZDJPY and Australian dollar AUDNZD
Knife Catch
To buy into a stock that is “falling like a knife”. very fast and within an unknown bottom and you could get hurt buying it. A knife catch would be near the lowest price before it begins to rebound.
Krupinski
When you buy the wrong stock thinking it is something else. ” You fool thats the wrong symbol, not Apple, you just pulled a Krupinski
Kumo
Ichimoku element the “Cloud”, the Kumo represents the area in between Senkou Span A and Senkou Span B & is the focal point of the Ichimoku system. When the price is over the Kumo, the top line indicates the first level of support, with the bottom line signaling the second support level. If the price is under the Kumo or Cloud, the bottom indicates the first level of resistance, with the top representing the second level. 
Kurtz
An ultimately degenerate trader whose style entirely overrules substance, providing a justification for amorality and evil.
L
LEAPS
Acronym for Long Term Equity Anticipation Securities. These are contracts that expire several months, or longer, in the future.
LIBOR
London Interbank Offer Rate. A key reference rate for loans, many loans are quoted as a premium to LIBOR i.e. LIBOR plus x basis points. It is also the most common interest rate that the largest international banks lend to each other at.
LL
Limited Liquidity – Limited number of shares available for trading by a brokerage (it’s difficult to buy into a stock that is LL)
LOD
Low of Day
Lagging Indicator
A measure of economic activity, which tends to change after change has occurred in the overall economy e.g. PPI & CPI.
Lame duck
A speculator who cannot discharge his or her liabilities
Law of Vibration
W.D. Gann attributed market movements to some undefined “law of vibration.” It is believed he is talking about the principles underlying the Square of Nine. “Just as the pendulum returns again in its swing, just as the moon returns in its orbit, just as the advancing year over brings the rose of spring, so do the properties of the elements periodically recur as the weight of the atoms rises.”
 
Left-hand Side
Taking the left hand side of a two way quote i.e. selling the quoted currency or security, hitting the bid.
Leg
When an options position is made up of a combination of multiple positions, each of the individual positions is known as a leg.
Legging
The process of entering or exiting a position that is made up of a combination of multiple positions by transacting each position individually.
Legging In
The process of entering an option position using legging.
Legging Out
The process of exiting an option position using legging.
Level 1
Shows the inside or best bid and ask prices (Not the market depth like Level 2)
Level 2
Real-time access to the NASDAQ and OTC order book showing depth of bid prices and sizes and ask prices and sizes on either side. Note many ECNs offer the ability for traders to post reserve orders and hidden orders. 
Leverage
The use of specific financial instruments, such as options, to get a greater potential return on invested capital, or the use of borrowed capital to achieve potentially greater profits.
Limit Order
Order used to buy or sell financial instruments at a specified maximum or minimum price respectively.
Limit Stop Order
An order used to buy or sell financial instruments at a specified maximum or minimum price respectively. The aim is to limit loss or product profit by exiting a position at a predetermined price.
Limited Convertibility
When residents of a country are prohibited from buying other currencies even though non-residents may be completely free to buy or sell the national currency.
Lines
These refers to credit and trading lines or limits. This is an arrangement where a bank or financial institution agrees to lend or provide to the client for a specified period any amount up to the full amount of the line or limit.
Liquidity
A market is described as liquid if the spread between the bid and the offer is tight or small. Another measure of liquidity is the market’s depth of buyers and seller, the more buyers and sellers the tighter the spreads. Illiquid markets have few players , hence, wider dealing spreads.
Listed Option
A type of option that is listed on an exchange, with fixed strike prices and expiration dates.
Long
A position to purchase more of an instrument than is sold, an appreciation in value if market prices increase. To cover a long you must sell the asset.
Long Call
Bullish Strategy from buying call options to get long or own a call option. Net Debit (upfront cost involved)
Long Gut
The long gut is an options trading strategy that can be used to try and profit when you are unsure which direction the price of a security will move in but are confident it will make a sizable move. Two transactions (buy calls and buy puts) and a debit spread (upfront cost)
Long Position
Position of being long on a financial instrument. If you own options contracts, then you hold a long position on them.
Long Put
Bearish Strategy to speculate on an asset going down in price by buying put options. Buying puts is a strategy that’s commonly referred to as the long put. It’s easier to use a long put than it is to short sell an asset, because there is not a margin involved. Net Debit (upfront cost involved). One Transaction (buy puts).
Long Put Ladder Spread
Bearish Strategy that is basically an extension of the bear put spread. This requires three transactions (buying puts & writing puts at different strikes) to create a debit spread or a Credit Spread. Used when the expectation is that the price of the security will not fall substantially. It’s also known as the bear put ladder spread and can result in big losses if the downward price movement is bigger than expected.
Long Straddle
The long straddle has two transactions involved; buying call options and buying put options. Volatile strategy with two transactions (buy call options and buy put options). Debit spread (upfront cost)
Long Strangle
Volatile strategy with the aim to profit regardless of which direction the price of a security moves in, providing it moves significantly. There are only two legs in the long straddle: a long call and a long put. Debit spread (upfront cost).
Look Back Option
A type of option that allows the holder to exercise the option at the best price that underlying security reached during the life of the option. These reasons lookbacks are generally more expensive, so the advantages do come at a cost. Lookbacks can be either calls or puts, also known as hindsight options, as they actually give the holder the benefit of hindsight when determining when to exercise. Two different types of lookback options – fixed strike and floating strike.
Loonie
USDCAD The Canadian Dollar’s nickname is rooted in the word “loon”, an aquatic bird native to Canada, inscribed on the backside of the one-dollar coin.
M
M Squared
To completely mess a good trade up, turn a profit into a loss. To make something that would be otherwise good, bad. “He went M Squared on that trade not taking profit at the close”
MITI
Japanese ministry of International Trade & Industry.
MM
Market maker
Managed Float
This is when we have partially free floating markets, that is monetary authorities manage when they deem they need to. They may intervene regularly in the market to stabilize volatility or spasmodically around preset price bands for a currency.
Margin
This is the amount a customer must deposit as collateral to trade or invest in markets. It is to cover any potential losses from adverse movements in market prices.
Margin Call
A requirement from a broker or dealer for additional funds or other collateral to bring the margin up to a required level to guarantee performance on a position that has moved against the customer. This limits are set by both regulatory authorities and the financial institution may enhance them or determine them in unregulated markets.
Market Makers
Professional, high-volume traders that are generally employees of financial institutions that ‘make a market’, responsible for ensuring there’s adequate depth and liquidity within the market in order for it to run efficiently.
Market On Close Order
Type of order used to buy or sell financial instruments at the current market price. A market order will always be filled providing there’s a corresponding seller or buyer.
Market Order
An order to buy/sell at the best price available when the order is placed in the market, that is it is not at a limited or predetermined price.
Market Risk
This is the risk relating to the market itself. Whilst it can be reduced it cannot be diversified away by hedging or holding a variety of securities.
Market Stop Order
An order to close a position at market price when a certain price is reached, a stop market order,
Married Puts
The married put is very similar to the protective put, but there are some key differences between these two strategies. The married put is used to limit potential losses from a long stock position and is used at the same time as entering a long stock position. A married put is a form of insurance when buying stock, to cover any potential losses should the price of the stock fall instead of going up. The protective put is used to protect profits that have already been made from a long stock position.
Meme
A stock that spreads from person to person within a culture; an amusing or interesting stock or genre of stocks that is spread widely online especially through social media.
Mid-price or Middle Rate
Often used for revaluation it is the price half-way between the two prices, or the average of both buying and selling prices quoted by the market makers.
Mine and Yours
To announce that a trader wants to buy he/she may say “Mine at …” when taking or paying the offer. To sell he/she will say “yours at … as he or she is “hitting the bid”
Monetarism
A school of economics, which believes that strict control of money supply is the principal tool for implementing monetary policy. It’s prime author is Milton Friedman, the primary focus is on inflation. The most common tools are government spending and interest rates.
Monetary Policy
A central bank’s management of a country’s money supply. Economic theory underlying monetary policy suggests that controlling the growth of the amount of money in the economy is the key to controlling prices and therefore inflation. The interest moves will affect exchange rates as it determine the pay back to the purchaser or seller as reflected in the forward rates.
Moneyness
Is the relationship between the strike price of an options contract and the price of the underlying security. There are three main terms that are used to describe the moneyness of an options contract: in the money, at the money, and out of the money. A fourth term, near the money, can also be used. The moneyness of an options contract basically changes between these states and when the price of the underlying security moves.
Morning Star
Candlesticks (Hoshi) “Morning Star” is a three-period pattern formed when the middle period has a window between the real bodies of the first and third candles in the formation. This is analogous to an “island bottom” in conventional charting. If the middle candle is a Doji, the pattern is called a “Morning Southern Cross”.

Morphing
The changing of one position into another position with just one order, typically used with synthetic positions.
Murrey Math
Murrey math was developed by T. Henning Murrey in 1995 based on observations made by WD Gann in the first half of the 20th century.  The grid is marked in 1/8 increments to square the price.

N
Naked Intervention
This refers to central bank intervention in the foreign exchange market without direct interest rate assistance. This type of intervention has a monetary effect on the money supply and a long term effect on foreign exchange.
Naked Option
Where the writer of a contract doesn’t have a corresponding position in the underlying security to protect them against unfavorable price movements. Also known as an uncovered option. Writing calls without owning enough of the underlying security is writing naked options or taking a naked position. Writing calls without owning enough of the underlying security is writing naked options or taking a naked position.
Near The Money Option
An option where the price of the underlying security is very close to the strike price.
Nearby Contracts
The closest active futures contracts, i.e. those that expire the soonest.
Negative Sloping Yield Curve
A yield curve where interest rates in the shorter dates are above those in the longer dates. For example 90 day rates may be at 10%, 2 year at 8%, 10 year at 7% etc.
Neutral Market
When the overall market is relatively stable it’s either bullish or bearish
Neutral Outlook
An expectation that the market, or a specific financial instrument, will remain relatively stable in price.
Neutral Trading Strategies
Strategies that can be used to profit from the price of a financial instrument not moving, or moving only slightly. Examples include Covered Call, Covered Call Collar, Covered Put Short, Straddle Short Strangle, Short Gut, Calendar Call Spread, Calendar Put Spread, Call Ratio Spread, Put Ratio Spread, Calendar Straddle, Calendar Strangle, Butterfly Spread, Condor Spread, Albatross Spread, Iron Butterfly Spread, Iron Condor Spread, Iron Albatross Spread
Nostro Account
A foreign currency current account maintained with another bank. The account is used to receive and pay currency assets and liabilities denominated in the currency of the country in which the bank is resident
O
O.C.O. Order
’One Cancels Other Order’ is a a contingent order where the execution of one part of the order automatically cancels the other part. A variation of the ’if done’ order type.
OECD
Organization of Economic Co-operation and Development.
OTM
Out of The Money An option strike out of the money of the current market price of the underlying
Odd Lot
A non-standard amount for a transaction.
Off balance sheet
Whilst Enron brought this to the forefront, there is a legitimacy with products such as Interest Rate Swaps and Forward rate Agreements are examples of ’off balance sheet’ products. Finacing from sources other than equity and debt are other examples.
Offer
The price or rate that a seller is prepared to sell at.
Offsetting Transaction 
A trade that serves to cancel or offset some or all of the market risk of an open position.
One Cancel Other Order
Abbreviated to OCO, this is a type of combination order where one order is cancelled when the other one is filled.
One Sided Market
A market where the buyers significantly outnumber the sellers or the sellers significantly outnumber the buyers.
One Trigger Other Order
Abbreviated to OTO, this is a type of combination order where one order is automatically executed when the other one is filled.
Online Broker
A broker that enables you to enter your orders using an online trading platform.
Open Interest
Open interest as it applies in options trading is very straightforward; it’s a number that shows the amount of currently open positions of options contracts. The higher the open interest of a contract, the more open positions there are for it. Options contracts that have a high open interest tend to also have high liquidity.
Open Interest 
The total number of outstanding option or futures contracts that are open, not offset or fulfilled by delivery.
Open Position 
When a trade or position is still open to the vagaries of the market. That is not yet closed out or settled. That is the position is still subject to market risk.
Opening Order
An order that is used to open a new position. See Buy To Open Order or Sell To Open Order.
Option / Options Contract
The right to buy or sell a specified underlying security at a fixed strike price within a specified period of time
Option Pain
Theoretical price of an underlying security that will result in the highest number of traders losing the highest amount of money due to options contracts expiring out of the money. Also known as Max Pain.
Option Pain
Theoretical price of an underlying security that will result in the highest number of traders losing the highest amount of money due to options contracts expiring out of the money. Also known as Max Pain
Optionable Stock
Stock that has options based on it.
Options Broker
An individual or a company that executes orders to buy and sell options contracts on behalf of clients.
Options Chain
A table that lists the various information that pertains to options contracts is commonly known as an options chain.
Options Symbol
Effectively the name of an option; a string of characters that defines specific options contracts.
Options Trader
Any investor that buys and/or sells options contracts.
Options Trading
The process of buying and/or selling options contracts as a form of investment, to make short term profits, or to hedge existing positions.
Order
An order is an instruction, from a client to a broker or specialist to place a trade. Please see the many types of orders that exist.
Out of the Money Option
An option where the price of the underlying security is in an unfavorable position, relative to the strike price, for the holder: meaning it has no intrinsic value. A call is out of the money when the price of the underlying security is lower than the strike price and a put is out of the money when the price of the underlying security is higher than the strike price.
Over The Counter (OTC)
Used to describe any transaction that is not conducted over an exchange.
Over The Counter Option
A type of option that is only sold over the counter (OTC) and not on the public exchanges.
Overnight
A position that is open after the close of the market or in forex a trade that remains open until the next business day of the trader’s time zone.
Overnight Limit
Net long or short position in one or more currencies that a dealer can carry over into the next trading or dealing day. Unlike a static exchange traded instrument in forex the position book can be monitored in other geographical locations or the next trading time zone to reduce the need for dealers to actively maintain their unmonitored exposures. Through instruction they are effectively passively maintained.
P
PDT
Pattern Day Trader
PH
Power Hour, the last hour of trading on an exchange into the market close.
PT
Price target
Paper hands
Weak hands selling and retrospectively after a larger gain was possible. ( Toilet paper and hands up emojis)
Parity Grid
A term originally coined and used in the context of the European Monetary System (EMS), which consists of the upper, central and lower intervention points between member currencies. It’s purpose these days refers to major currencies as monitored by their respective central banks. It’s relevance is for trading partners such as Japan and the USA, Australia and New Zealand (CER) or the Asian Tiger economies.
Pegging
A form of price stabilization; typically used to stabilize a country’s currency by making it fixed to the exchange rate with another country. Examples include the Hong Kong Dollar and Chinese Yuan which are both pegged to the US Dollar.
Petrodollars
Foreign exchange reserves of oil producing nations arising from oil sales.
Physical Option
An option where the underlying security is a physical asset that is neither stock nor futures contracts.
Physically Settled Option
A type of option in which the underlying security changes hands between the holder and the writer of the options when it’s exercised.
Pin risk
Occurs when the price of the underlying stock or future of an option contract at expiration is very close to the option’s strike price. Leaving an unknown assignment
Pip (or Points) 
The term used in currency markets to represent the smallest incremental move an exchange rate can make. Depending on the currency but examples of one basis point are 0.0001 in the case of EUR/USD, GBD/USD, USD/CHF and .01 in the case of USD/JPY.
Portfolio
The combined holdings of any financial instruments owned by an individual, group, or financial institution.
Position
A position is the number of contracts or lots – long or short held by the trader or investor
Position Trader
A trader who uses the unique opportunities that options offer to profit from factors such as time decay and volatility.
Position Trading
Position trading in financial instruments is where using stocks, bonds or derivatives such as options and futures in structures designed to have a position in the security.
Premium
In the currency markets, it is the amount of points added to the spot price to determine a forward or futures price.
In the options market it refers to the price charged over the intrinsic or underlying price of the asset.
Premium Value
See Extrinsic Value
Pricer
A specific type of option chain that displays the five main Greeks in addition to other standard information.
Pricing Model
A mathematical formula that is used to value or price an option contract based on specific factors. See Black Scholes Pricing Model or Binomial Pricing Model for examples.
Protective Call
A strategy that is used to protect profits in a short stock position. The strategies is for when a stock position has made you a profit, but you don’t want to realize that profit right away and you would rather keep your position open. At the same time, you also have some protection against the position reversing. If you have short sold stock and the stock has gone down in value, a protective call enables you to keep the short position open and reduce the risks involved should the stock go back up in value.
Protective Put
A strategy that is used to protect profits in a short stock position. The strategies is for when a stock position has made you a profit, but you don’t want to realize that profit right away and you would rather keep your position open. At the same time, you also have some protection against the position reversing. If you own stock and it goes up in value, then you can use a protective put to enable you to hold on to it and reduce the risk should it fall back down in value. The idea is to enable you to participate in any upside of price while protecting your downside.
Proxy Hedge

A term to describe when it is necessary to hedge against a currency where there is no market but it follows a major currency, the hedge is entered against the major currency.
Psych
Psychological level for example round numbers like $1, $1.50, $2,$10 etc
Pump and Dump
Practice of buying shares, generating favorable publicity about them, especially on the internet or social media, then selling them when the price spikes higher.
Pump and Dumper
Artificially inflating the price of an owned stock through false and misleading positive statements, in order to sell the cheaply purchased stock at a higher price.
Purchasing Power Parity
Model of exchange rate determination stating that the price of a good in one country should equal the price of the same good in another country, exchanged at the current rate. Has been popularized with the Big Mac index in recent years. Here the price of a Big Mac is priced in the local currency and then converted back to US Dollars.
Put
A type of option which grants the holder the right, but not the obligation, to sell the relevant underlying security at an agreed strike price.
Put Bear Butterfly Spread
The bear butterfly spread has two variations: the call bear butterfly spread and the put bear butterfly spread. It requires three transactions (buy puts/write puts/buy puts) and creates a debit spread. Can also use Calls
Put Call Parity
Pricing that’s based on avoiding arbitrage by ensuring the extrinsic values of related calls and when puts are equal, or close to equal in value.
Put Ratio Backspread
Two transactions (buy puts and write puts). Credit spread (upfront credit received)
Put/Call Ratio
Simply the number of put options contracts traded in a given day divided by the number of call options contracts traded that same day.  The put volume divided by the call volume yields the Put/Call Ratio. The custodian of the Put/Call Ratio is the Chicago Board Options Exchange (CBOE). More options contracts are traded through the CBOE each day than on any other exchange. 
Pyramiding
The use of profits on existing positions as margin to increase the size of the position, normally in successively smaller increments.
Q
Q&D
A quick trade taking advantage of bad news. Acronym for quick and dirty.
Quadruple Witching
The third Friday in the months of March, June, September, and December are the days when stock options, index options, stock futures, and index futures all reach their expiration point; this usually leads to high trading volume and increased volatility.
Quarterly Option
A type of option that uses a quarterly expiration cycle.
Quote
An indicative market price; shows the highest bid and/or lowest ask price available on a security at any given time.
R
R/G
Red to Green move, from negative to positive on the day.
R/R
Risk to Reward ratio
R/S
‘Reverse Split’ – a reduction in the number of a company’s traded shares (float) that results in an increase in the par value or earnings per share.
ROI
See Return on Investment.
RTH
RTH regular trading hours
Rate 
The price of one currency in terms of another.
Ratio Bear Spread
Requires two transactions (buy puts & write puts) and can create either a debit spread or credit spread, depending on the ratio of options bought to options written. It is basically an advanced bear put spread. Unlike the bear put spread you don’t write the same number of options as you buy, you write a higher amount at a ratio that suits what it is you are trying to achieve. The bear ratio spread can be used to lower upfront costs (or even eliminate them) or to increase the potential profits if the underlying security falls to a specific price you have forecasted. Also known as Bear Ratio Spread, Ratio Put Spread
Ratio Put Spread
Requires two transactions (buy puts & write puts) and can create either a debit spread or credit spread, depending on the ratio of options bought to options written. It is basically an advanced bear put spread. Unlike the bear put spread you don’t write the same number of options as you buy, you write a higher amount at a ratio that suits what it is you are trying to achieve. The bear ratio spread can be used to lower upfront costs (or even eliminate them) or to increase the potential profits if the underlying security falls to a specific price you have forecasted. Also known as Bear Ratio Spread, Ratio Bear Spread
Ratio Spread
A spread that is created using multiple contracts of differing amounts. This typically involves writing a higher number of options than is being bought, but the ratio can be either way around.
Realized and Unrealized Profit and Loss
In an accrual type accounting system an “unrealized profitor loss ” exists until the securities are sold or when a short is covered. When the securities are sold or covered the profit or loss becomes “realized.”
Reciprocal Currency
A currency that is normally quoted as dollars per unit of currency rather than the normal or standard quote method of units of currency per dollar. The British Pound is the most common example.
Resistance
A term used in technical analysis that delineates a specific price level or price cluster at which a security or currency will will find difficulty in surpassing.
Return On Investment
Abbreviated to ROI, this is the percentage of profit that’s made, or could be made, on an investment.
Reval Rates 
The revaluation rates are the market rates used when a trader runs an end-of-day report to establish profit and loss for the day on his/her open position.
Reverse Iron Albatross Spread
Four transactions involved using the buy to open order and the sell to open order. Basically, same as reverse iron condor spread, uses a wider range of strike prices.
Reverse Iron Condor Spread
Advanced strategy that involves calls and puts, that requires a total of four transactions. Designed to be used when expecting an underlying security to make a sharp move in price, but aren’t sure in which direction of the move. It’s an advanced strategy that involves calls and puts, and it requires a total of four transactions Four Transactions (buy puts/ write puts/buy calls /write calls) Debit Spread (upfront cost)
Rho Value
One of the Option Greeks, the rho value measures the theoretical effect of changes in interest rates on the price of the option.
Right-hand Side 
To do a deal on the right hand side of a two way quote, normally to buy the currency and sell dollars.
Risk
Exposure to uncertain change – the unknown variables that can significantly affect returns or the underlying asset or liability.
Risk Capital
The amount of money that an individual can afford to invest, which, if lost would not affect their lifestyle.
Risk Management 
The identification and acceptance or offsetting of the risks threatening the profitability or the very existence of an organization. With respect to foreign exchange involves among others consideration of market, sovereign, country, transfer, delivery, credit, and Counterparty risk.
Risk Premium
Additional sum payable or return to compensate a party for adopting a particular risk.
Risk Reversal
Used as a measurement that can be used as a way of evaluating sentiment in the market. Positive risk reversal (i.e. calls are more expensive than puts) suggests the market on the underlying security is generally bullish. When there’s negative risk reversal (i.e. calls are cheaper than puts) suggests that the market on the underlying security is bearish.

A hedging strategy, commonly used by commodities traders, to protect against potential unfavorable price movements in an owned asset. The risk reversal strategy is used by selling out of the money calls and buying out of the money puts options based on an underlying security that is already owned.
Risk to Reward Ratio
Ratio that compares the anticipated returns of entering a position with the potential losses that may be incurred by entering that position. It is calculated by simply dividing the expected amount of profit by the amount of potential losses.
Rolling
A trading technique used to close an existing position and open a similar one at the same time, with slightly different terms. Usually rolling to a forward expiration date.
Rolling Down
The process of closing an existing position and opening a comparable position at the same time, but with a lower strike price.
Rolling Forward
The process of closing an existing position and opening a comparable position at the same time, but extending the time left until expiry.
Rolling Up
The process of closing an existing position and opening a comparable position at the same time, but with a higher strike price.
Rollover 
The settlement of a deal is rolled forward to another value date with the cost of this process based on the interest rate differential of the two currencies.
Round Trip
Both sides of a trade. Buying and selling of a security, future or options contract.
Runner
A stock that drastically gains in value over a short period of time “We got ourselves a runner here”
Running Flat 
In Elliott Wave Theory this pattern is a kind of Flat, with an elongated B wave and a very small C wave. This pattern also resembles an extension in an impulsive wave, where the wave has subdivided in two (or more) 1,2 combinations. These patterns have become very prevalent in Manic corrections.
Running a Position
Keeping open positions in the hope of a speculative gain, protecting yourself with a trailing stop loss order.
Ryan Leaf
A stock that is extremely overhyped or over rated. “That IPO is a Ryan Leaf.”
S
SDR
Special Drawing Right. A standard basket of five major currencies in fixed amounts as defined by the IMF.
SMA
Simple Moving Average – a type of moving average indicator frequently used in technical analysis
SSR
Short sale restriction
STC
Sell To Close
STO
Sell To Open
Sanpei
Candlesticks “Sanpei” is a three-period pattern in which all the candles are the same color.
This pattern indicates that the current market direction will continue.

Scale in / Scale out
To sell or buy a portion of your shares or futures
Scalping
A strategy of buying at the bid and selling at the offer as soon as possible.
Secondary
A secondary offering is an offering that is given after the Initial Public Offering (IPO).  Even if a company performs multiple secondary offerings, they are always called secondary.  A secondary offering will raise money for the company by selling more shares.  This increases the supply of shares on the market and usually decreases the value of those shares. 
Sell To Close Order
An order placed when you want to close an existing long position through selling the contracts you have previously bought.
Sell To Open Order
An order placed when you want to open a new position through writing new contracts.
Senkou Span A
Ichimoku element Senkou Span A is a moving average of two other elements; the Tenkan Sen and Kijun Sen, projected 26 days ahead. Also called the first leading line, Senkou Span A is used with Senkou Span B to formulate the Ichimoku Cloud or “Kumo”.
Senkou Span B
Ichimoku element (Second leading line) averages the highest high and lowest low for the last 52 days, plotted 26 days ahead. As the longest term represented in the Ichimoku trend analysis, time-shifting Senkou Span B forward provides a visual of how the price on a certain date acts in relation to support and resistance from the 52 trading days before. Used with Senkou Span A, the two lines form the outline of the Ichimoku Cloud (Kumo). 
Settlement
The finalizing of a transaction, the trade and the counterparts are entered into the books.
Shooting Star
Candlesticks (Hoshi)  A three-period pattern formed when middle candle is a small inverted Hammer, the pattern is called a “Shooting Star”.
Short
To ’short’ is to sell an instrument without actually owning it – effectively you’re are borrowing the asset you have sold. You are shorting with the expectation that you will buy the instrument at a lower level so as to profit from the short sale.
Short Albatross Spread
Advanced strategy that can be used when the market is volatile. Four Transactions (buying and writing calls or puts using different strikes). It’s designed to be used when your expectation is that a security will make a significant price move, but you cannot be certain in which direction. Same as short condor spread but with wider prices. Credit Spread (upfront credit received)
Short Bear Ratio Spread
Advanced strategy constructed to generate profits from the price of a security falling in value. Two Transactions (buy puts & write puts). It’s essentially an extension of just buying puts (the long put), in that it can provide a high return on investment if a security does fall in price, but it allows you to reduce the amount of capital you need to invest.
Short Bull Ratio Spread
Options trading strategy used to profit from a security increasing in price in a similar way to simply buying calls. Two Transactions (buy calls & write calls). Specifically designed to reduce the upfront costs of taking such a position while still allowing for unlimited profits. Requires two transactions, but there are some complexities involved, such as choosing an appropriate ratio and knowing which strike prices to use.
Short Butterfly Spread
Advanced options trading strategy for a volatile market. Used to try and profit when expecting price of a security to make a significant move but aren’t sure in which direction. Three Transactions (write calls/write calls /buy calls) or (write puts/write puts/buy puts)
There are three transactions involved and it can be created using either calls (the short call butterfly) or puts (the short put butterfly). Potential profits and potential losses are both limited, and you receive an upfront credit when creating the spread.
Short Calendar Straddle
Complicated options trading strategy, with four transactions, (buy calls/write calls/buy puts/write puts). As a volatile strategy it’s designed to return a profit when a security moves significantly in price, regardless of in which direction. It’s really a spread that combines two other spreads (the long straddle and the short straddle). Credit Spread (upfront credit received)
Short Calendar Strangle
Complex options trading strategies with four transactions are required to create the spread with a volatile trading strategy, so it’s designed to be used when your expectation is that a security will move substantially in price. Two other spreads combined (the short strangle and the long strangle). Four Transactions (buy calls /write calls /buy puts /write puts). Credit Spread (upfront credit received)
Short Call
Term used to describe the strategy of selling or writing calls based on an asset that you are expecting to go down in price, involves short selling calls. It can also be referred to as an uncovered call write, agreeing to sell someone an asset that you don’t actually own. One Transaction (sell calls). Net Credit (upfront payment received)
Short Call Calendar Spread
Options trading strategy for a volatile market designed to be used when you are expecting a security to move dramatically in price, but you are unsure in which direction it will move. There are actually two variations of this strategy: the short horizontal calendar call spread and the short diagonal calendar call spread. The short horizontal calendar call spread is the more commonly used. Two Transactions (buy calls and write calls). Credit Spread (upfront credit received). Also known as Short Call Calendar Spread, Short Time Call Spread
Short Condor Spread
Advanced strategy that can be used when the market is volatile. Four Transactions (buying and writing calls or puts using different strikes). It’s designed to be used when your expectation is that a security will make a significant price move, but you cannot be certain in which direction. Same as Albatross Spread but with tighter prices. Credit Spread (upfront credit received)
Short Covering
Buying to unwind a shortage of a particular currency or asset.
Short Float
The ratio of tradable shares being shorted to shares in the market.
Short Gut
Options trading strategy used to produce a net profit when the price of security stays within specified limits for a particular period of time. Similar to both the short straddle and the short strangle, but the short gut can return profits from a wider price range than both of those. Two Transactions (write calls and write puts). Credit Spread (upfront credit received). This strategy involves writing options to receive an upfront credit, with the idea that any future liabilities will be less than that credit.
Short Position 
An investment position that results from short selling. Benefits from a continuing decline in market price whilst position is not covered.
Slap
To hit the asking price with either a market buy or bid on the asking price
Small Bodies
Candlesticks
#1 Red (White) Spinning Top – Unsure of Which Direction to Move
#2 Black Spinning Top – Unsure of Which Direction to Move
#3 Red (White) Hammer – If it is Higher at a Top, Sell;
Hanging Man – If it is Lower at a Bottom, Buy
#4 Black Hammer – If it is Higher at a Top, Sell;
Hanging Man – If it is Lower at a Bottom, Buy
# 5
Red (White) Inverted Hammer If it is Higher at a Top, Sell;
Shooting Star – If it is Lower at a Bottom, Buy
# 6
Black Inverted Hammer – If it is Higher at a Top, Sell;
Shooting Star – If it is Lower at a Bottom, Buy

Sovereign Risk
Risk of default on a sovereign loan
Risk of appropriation of assets held in a foreign country.
Spoos
S&P 500 futures
Spot
A transaction that occurs immediately, but the funds will usually change hands within two days after deal is struck.
Sterling
Another term for the Great British Pound.
Stock Option
A type of option where the underlying security is stock in a publically listed company.
Stock Repair Strategy
The strategy’s aim is to repair, or fixes, a trade that is broken. Simple options trading strategy used to make it easier to recover when a long stock position has resulted in losses due to a drop in the price of the stock.
The two main advantages of using this strategy are there are no further costs associated and it means that you can recover your losses more quickly if the stock starts to move back up in price. There are only two transactions involved; you need to buy enough at the money call options to cover the amount of stock owned and then write twice as many as out of the money calls.
Stock Replacement Strategy
A strategy that involves buying deep in the money call options instead of the underlying stock. The strategy is used to reduce the capital required to enter the position.
Stop Order
An order to buy/sell at an agreed price. One could also have a pre-arranged stop order, whereby an open position is automatically liquidated when a specified price is reached or passed.
Strap Straddle
Strategy designed to be used when you cannot determine which direction the price of the security will move in. Essentially a modified long straddle where instead of buying an equal amount of call options and put options you buy a higher number of calls. Two Transactions (buy calls and buy puts). Debit Spread (upfront cost). Is also known simply as the Strap.
Strap Strangle
Strategy aimed to return larger profits if the price of the security goes up than it will if it goes down. Used when your volatile outlook is coupled with a bullish inclination. The strap strangle is essentially a long strangle with one significant amendment; you buy a larger number of calls than you do puts. Two Transactions (buy calls and buy puts). Debit Spread (upfront cost)
Supply Side Economics
The inverse of theories espoused by Maynard Keynes (Keynesian) of demand side theories. The concept is that tax cuts will boost investment leading to an increase in the supply of goods in the economy.
Support
A term used in technical analysis indicating a specific price level or cluster at which a security or currency should have difficulty to fall below.
Swap
A swap occurs when one currency is temporarily exchanged for another, then the currency is held and exchanged later after a fixed period of time. To calculate the swap take the interest rate differential between the two underlying currencies, thus it may be used for speculative purposes to exploit anticipated movement in the interest rates.
Swing Trader
A trader who looks for relatively short-term price swings and aims to profit from those swings by trading accordingly. Differs from a day trader as normally not restricted by not holding positions overnight.
Swing Trading
Style of trading used by swing traders, where positions are usually held for a relatively short period of time in order to profit from short term price swings. Essentially a style that is somewhere between the longer-term approach of using a buy and hold strategy and the very short term style of day trading.
Swissy
Market jargon used in the foreign exchange market for the Swiss franc against the US dollar. CHF is the abbreviation for the Swiss franc, the official legal tender of Switzerland and Liechtenstein. CHF stands for Confoederatio Helvetica franc, where Confoederatio Helvetica is the Latin name for the Swiss Confederation. Switzerland is one of the few European countries that has not adopted the euro. The Swiss Franc is mainly traded against the US dollar (USDCHF), also known as dollar swiss and against the Euro (EURCHF) and is known as EuroSwiss
Sympathy
When an instrument moves in sympathy to another instrument due to an event or relationship. A stock or future gains or loses value due to another stock or future that is associated with it also gaining or losing value. Sympathy can be from being in similar sectors, having very similar equity curves, being based out of the same country, similar legal effects of new laws/restrictions/regulations, etc.
Synthetic Long Call
A synthetic position which is essentially the same as owning calls. It involves buying puts and buying the related underlying security.
Synthetic Long Put
A synthetic position which is essentially the same as owning puts. It involves buying calls and short selling the related underlying security.
Synthetic Long Stock
A synthetic position which is essentially the same as owning stocks. It involves buying at the money calls and writing at the money puts on the relevant stock.
Synthetic Position
Basic definition of synthetic positions is that they are trading positions created to emulate the characteristics of another position. More specifically, they are created in order to recreate the same risk and reward profile as an equivalent position.

In options trading, they are created primarily in two ways. A combination of different options contracts to emulate a long position or a short position on stock, or you can use a combination of option contracts and stocks to emulate a basic options trading strategy. In total, there are six main synthetic positions that can be created, and traders use these for a variety of reasons. Synthetic Long Stock, Synthetic Short Stock, Synthetic Long Call, Synthetic Short Call, Synthetic Long Put, Synthetic Short Put
Synthetic Short Call
A synthetic position which is essentially the same as being short on call options. It involves short selling stock and then writing put options based on that stock.
Synthetic Short Put
A synthetic position which is essentially the same as being short on put options. It involves buying a stock and then writing call options based on that stock.
Synthetic Short Stock
A synthetic position which is essentially same as being short on stock. It involves the writing of at the money call options and buying at the money put options on the relevant stock.
Synthetic Short Straddle
A synthetic strategy that essentially replicates the Short Straddle trading strategy. The synthetic short straddle is created with a combination of stocks and options. It can be made in two ways. One is by owning stocks and being short on twice the number of calls based on that stock. The second is by being short on stocks and also being short on twice the amount of put options based on that stock.
Synthetic Straddle
A synthetic strategy that essentially replicates the Long Straddle trading strategy. It also uses a combination of stocks and options. There are actually two ways to create one. The first is by owning stocks and also owning twice the amount of at the money puts based on that stock, and the second is by being short on stock and owning twice the amount of at the money calls based on that stock.
T
Technical Analysis
Studies and theories to forecast future market activity by analyzing market data such as charts, price trends, and volume
Tendies
Options likely to deliver
Tenkan Sen
Ichimoku element – (Turning line) moving average measures the highest high and lowest low for the last nine days. This Ichimoku element is normally used alongside Kijun Sen to determine the probability of future momentum.
Theoretical Value
The value of a specific option, or position, that is calculated by a pricing model or other mathematical formulas.
Theory of Elasticity 
A model of exchange rate determination stating that the exchange rate is simply the price of the foreign exchange, which maintains the BOP in equilibrium. It then determines the degree to which the exchange rate responds to a change in price.
Theta Value
One of the Greeks, the theta value measures the theoretical rate of time decay of that option. The extrinsic value of an options contract will diminish over time as the expiration date of that contract approaches, due to the effects of time decay, and Theta is an estimated measurement of the rate at which this happens. In theory, theta value will tell you how much the price of an option will depreciate on a daily basis.

Calls and puts both have negative theta values, because they both lose extrinsic value over time due to time decay. If you write options to take up a short position on them, then theta will work in your favor. When you own options contracts, time decay has a negative impact on the value of the contracts that you own, but when you are short on options the effect of time decay is a positive impact.
Thin Market
A market in which trading volume is low and in which consequently bid and ask quotes are wide and the liquidity of the instrument traded is low.
Three Red Soldiers
Candlesticks “Sanpei” If three red (white) candles occur, the pattern is called “Three Red Soldiers”
(Candles # 1-3).
Tick
Minimum price move.
Ticker 
Shows current and/or recent price or news history of the currency or security in the format of a scrolling, cascading or moving table.
Time Decay
The process by which the extrinsic value diminishes as the expiration date of the option gets closer. That is the reduction in value of an options contract as reaches its expiration date. Time decay isn’t a linear function. Once there is less than one month to go, time decay will typically have much more impact on the extrinsic value. Basically, the closer the expiration date, the faster the rate of time decay. The rate of time decay is measured by one of the options Greeks, Theta. The Theta value of an options contract theoretically defines the rate at which its price will decline on a daily basis.
To the moon
When a stonk rockets up in price. (Rocket and moon emoji)
Tommy
A trade when you get revenge on the market for misdeeds from others. “I shorted this overpriced stock, this ones for Becky”
Tomorrow Next (Tom/Next)
The simultaneous swap from spot of a currency by buying and selling of a currency for delivery the following day.
Trade-weighted Exchange Rate 
The changes in the exchange rate against a trade weighted basket including the currencies of the county’s principal trading partners. Examples are the US Dollar Index in the US and the Trade Weighted Index (TWI) in Australia.
Trading Levels
A level that’s assigned to account holders at brokers to indicate what level of risk they can be exposed to. They are used to protect traders that have insufficient capital or inadequate experience from entering trades that they shouldn’t have. Also known as approval levels.
Trading Plan
A detailed constructed plan a trader has to approach and implement their trading. The plan would usually include defined objectives, details of methods that will be used for budget control, risk management, and which strategies will be used.
Trading Style
The method or approach that a trader undertakes to follow; there are several specific types of trading styles. Day Trading, Swing Trading, Position Trading and Market Makers
Trailing Stop Order
A type of order that includes a stop price which is based on a percentage or absolute change from the previous best price.
Trend
A recognizable and continued movement in a market or in the price of a specific financial instrument.
Triangles
A triangle is a corrective pattern, which can contract or expand. Furthermore it can ascend or descend. It is composed of five waves, each of them has a corrective nature.
Tripolarism
The world economy is characterized by a tripolarism based on the Dollar, Euro and Yen. They are the most heavily traded currency and most favored for international trade and finance. The dollar is the most favored vehicle for currency exchange worldwide, in 87 percent of all transactions in 1998 – in 1989 it was 90 percent. Prior to the Euro the Deutschemark was in 30 percent of transactions and the yen in 21 percent. In international Trade the dollar has been estimated to account for nearly half of all world exports (Hartmann 1998)
Turnover
The volume traded, or level of trading, over a specified period, usually daily or yearly
Tutes
Institutional investors
Two Way Price
Both the bid and offer rate is quoted for a Bond, Forex, Stock or Futures transaction.
U
US Dollar Index 
U.S. Dollar Index® Futures Contract (USDX) was developed as a Trade Weighted Index, a geometrically weighted average of ten different currencies, with each currency representing a country that was a major trading partner with the United States.
US Prime Rate
The interest rate at which US banks will lend to their prime corporate customers.
Underlying Security
The asset, security, or financial instrument that an option is based on.
Uptick 
A new price quote that is higher than the preceding quote for the same currency or issue.
V
VWAP
Volume Weighted Average Price – calculated by taking the price multiplied by number of shares traded then divided by the total shares traded for the day. This is an indicator used in technical analysis
Value Date
The date that both parties of a transaction agree to exchange payments.
Variation Margin

An additional margin requirement that a broker will need from a client due to market fluctuation.
Vega Value
One of the Greeks, the vega value measures the theoretical effect of changes in the implied volatility of the underlying security on the price of the option. The Vega value of an option shows how much, in theory, the price will change for every percentage point the implied volatility of the underlying security increases by.

Vega relates only to the extrinsic value of an option, and not the intrinsic value. Whether you are buying calls or puts, the Vega value is always positive. However, when you write options the Vega value is effectively negative.
Vertical Spread
A type of spread that’s created using multiple contracts with different strike prices, but it has the same expiration dates. Vertical spreads can be either bull vertical spreads or bear vertical spreads; you would use bull verticals when you were expecting the underlying security to increase in price and bear verticals when you were expecting the underlying security to fall in price.
Volatile Market
A market that’s constantly moving unexpectedly and dramatically, with a high level of price instability.
Volatile Trading Strategies
Strategies that can be used to profit from a volatile market and/or a volatile financial instrument.
Volatility
A statistical measure of a market or a security’s price movements over time and is calculated by using standard deviations. Associated with high volatility is a high degree of risk.
Volatility Crunch
A significant drop in implied volatility.
Volatility Skew
When a graph that represents the implied volatility across options with the same underlying security, but different strike prices form a curve skewed to right.
Volatility Smile
When a graph that represents the implied volatility across options has the same underlying security but different strike prices, forms a concave similar in appearance to a smile.
Volume
The number of transactions that took place involving a specified financial instrument such as a particular option. One with a high volume means it has been heavily traded.
W
WL
Watch list
WW
Worth watching
WXY or Combination 
In Elliott Wave Theory a Combination combines several types of corrections. A so-called double or triple three is also a Combination, but this pattern combines Flats separated by X waves. These corrections are labeled as WXY and WXYXZ if it is even more complex.
Weekly Option
A type of option that uses a weekly expiration cycle.
Whipsaw
A term used to describe a condition in a highly volatile market where a sharp price movement is quickly followed by a sharp reversal. Whipsawing the trader around like in a car accident it
Wide Condor Spread.
The wide condor spread is a complex options trading strategy that involves four separate transactions. Four Transactions (buying and writing puts or calls at different strikes). It’s a neutral strategy designed to generate a return when a security remains stable in price and can be used with put or call options. It is a debit Spread and is also known as a Albatross Spread.
Window
In candlestick terminology a “gap” is called a “window”. When the market opens higher or lower than the previous CLOSE, a gap is formed. A window often serves as a support/resistance area. The market will often retrace its steps in order to close a window. Moving through a window is usually a strong continuation signal. In the diagram, a “window” occurs at the opening of day #5.

Window-dressing
Where financial institutions or companies raise funds for specific reporting dates such as year ends to give the appearance of high liquidity. Also refers to the manipulation of stock and bond prices by mutual funds and companies and reporting periods – to improve results for revaluation.
Wood Duck
A trader or investor with no idea, the wood duck got slammed on the trade
World Bank
World Bank – A bank made up of members of the IMF whose aim is to assist in the development of member states by making loans where private capital is not available.
Writer
The creator of new contracts to sell.
Writing an Option
The process of selling an option you do not own, creating new contracts to sell.
X
Xetra
Xetra is the trading venue operated by the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse). The majority of turnover on German exchanges goes through Xetra and is the reference market for exchange trading in German shares and exchange-traded funds (ETFs).
Y
YOLO
Acronym meaning you only live once. To Yolo a stock is to say screw it, I’m just going to buy it and hope it goes up despite any catalyst or lack thereof. This is not a sound investment strategy and should only be attempted for fun with relatively small positions if at all.
Yen
The yen is the basic monetary unit of Japan.  The symbol for the Japanese yen (JPY) is ¥. The value of the USD/JPY pair is quoted as one U.S. dollar per a certain amount of Japanese yen and is known as dollar yen. It is also heavily traded against the Australian dollar AUD/JPY and is known as Aussie Yen, the Euro EUR/JPY known as Euro Yen.
Yield Curve
The graph showing changes in yield on instruments depending on time to maturity. A system originally developed in the bond markets is now broadly applied to various financial futures.
A positive sloping curve has lower interest rates at the shorter maturities and higher at the longer maturities.
A negative sloping curve has higher interest rates at the shorter maturities.
A flattening Yield curve refers to yields coming down in the long end.
Z
Zigzag
A Zigzag is the most common corrective structure, which starts a sharp reversal. Often it looks like an impulsive wave, because of the acceleration it shows. We show you where a zigzag can extend itself into a double or triple zigzag. Whilst this is not very common, because it lacks alternation (the same two patterns follow each other).
This has been a feature of many markets in a mania, in particular the S&P 500. Furthermore the zigzag can only be the first part of a corrective structure. For this reason it is very important to be able to recognize and differentiate from an impulse wave.