Mar 16

Forex: Glossary F-M

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Federal Deposit Insurance Corporation (FDIC) – regulating Organization of the United States that administers the safe ones on banking deposits.


Federal Reserves (EDF)
– Central bank of the United States.
Flat/square – (Position of balance) – colloquial Expression used by dealers to describe a position that has been completely reverted. For example, you buy $500.000 and soon she sells $500.000, creating therefore a neutral position (of balance).

Foreign Exchange – (Forex, FX) – (Currency Market) – the simultaneous purchase of a currency and the sale of another one.
Forward – (Contract of Forward) – Type of change fixed beforehand in a contract for purchase currency sale in a decided future date, based on the differential in the interest rates between two currencies at issue.
Forward points – (Points forward) – pips added or cleared of the type of present change in order to calculate the price of forward.
Fundamental analysis – (fundamental Analysis) – Analysis of the economic and political data with the purpose of to determine future movements in the financial market.
Futures Contract – (Contract of futures) – Obligation to interchange or or a title to a price determined in a future date. The main difference between a Future and a Forward is that the Futures negotiate generally in stock-market (what ETC is denominated – negotiable Contract in stock-market), whereas forwards is considered contracts OTC (stock market). A OTC is all contract nonnegotiated in a stock market.
Good `Til Cancelled Order (GTC) – (valid Order until its cancellation or execution) – Order to buy or to sell to a certain price. The order remains open until the client makes specific or cancels the operation.
Hedge – (Cover) – a position or combination of positions that reduces the risk of the primary position.
Inflation – (Inflation) – economic Situation in which there is increase in the prices of the consumer goods, reducing the spending power.
Initial margin – (initial Margin) – the initial deposit of required guarantee to enter a position, like guarantee of future fulfillment.
Interbank rates – (interbank Rates) – Types of foreign exchange that the great international banks quote to other great international banks.
Leading Indicators – (Indicating main) – Statistical that is considered that they predict the future of the economic activity.
LIBOR – The London Inter-Bank Offered Rate. – (Interbank Rate of London) – the banks use the LIBOR rate when they take bottoms from another bank.
Limit to order - (limited Order) – Order with restrictions with respect the maximum price to pay or the minimum price to receive. For example, if the present price of the USD/YEN is 102,00/05, then a limited order
in order to buy USD it would be to a price inferior to 102 (that is to say, 101.5)
Liquidity – (Liquidity) – Ability of a market to accept great transactions with minim or any repercussion on the stability of prices.
Liquidation – (Liquidation) – the closing of an operation abierta through the execution of a compensation transaction.
Long position - (long Position) – a position that increases its value if the price of market raises.
Margin call – (Cover of the guarantee margin) – Request on the part of a runner or agent of additional bottoms or another type of assets to guarantee the fulfillment of a position that has registered adverse movements to the client.
Market Maker – (Creative of market) – an agent who regularly provide to quotes of purchase and sale and this ready to purchase and to sell to the stipulated prices.
Market Risk – (Risk of market) – Exhibition to variations in the prices of market.
Mark-to-Market - (Market to market) – Process of revaluation of all the positions abiertas with the present prices of the market. These new prices determine then the margin requirements.
Maturity – (Victory) – Date of liquidation or victory of a financial instrument.
Investor momentum – (opportunistic Investor) – Participant of the market that increases its exhibition in the market when this one is in rise and reduces its exhibition or sells in short when the market is in loss.

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