ST Global Markets Glossary

Technical analysis: It is the study of the patterns and historical data of the price and volume of a financial asset to predict future movements and make trading decisions.

Technical analysis: It is the study of the patterns and historical data of the price and volume of a financial asset to predict future movements and make trading decisions.

Leverage: It is a technique that allows you to operate with a greater amount of capital than you own. It allows you to increase the potential for profits, but also the risk of losses.

Financial advisor: A professional who provides advice and guidance on investments and financial strategies, including trading.

Asset: Refers to any negotiable financial instrument, such as stocks, bonds, currencies, commodities, etc.

Ask (Sale Price): It is the price at which a seller is willing to sell a financial asset in the market.

ATR (Average True Range): It is a technical indicator used to measure the volatility of a financial asset over a certain period of time.

Arbitrage: It is the practice of taking advantage of price differences of an asset in different markets or platforms to obtain profits.

Asset Allocation: It is the distribution of capital between different asset classes (stocks, bonds, cash, etc.) in order to diversify and manage the risk of an investment portfolio. It is a technique that allows you to operate with a greater amount of capital than you own. It allows you to increase the potential for profits, but also the risk of losses.

Financial advisor: A professional who provides advice and guidance on investments and financial strategies, including trading.

Asset: Refers to any negotiable financial instrument, such as stocks, bonds, currencies, commodities, etc.

Ask (Sale Price): It is the price at which a seller is willing to sell a financial asset in the market.

ATR (Average True Range): It is a technical indicator used to measure the volatility of a financial asset over a certain period of time.

Arbitrage: It is the practice of taking advantage of price differences of an asset in different markets or platforms to obtain profits.

Asset Allocation: It is the distribution of capital between different asset classes (stocks, bonds, cash, etc.) in order to diversify and manage the risk of an investment portfolio.

Bullish: It is a positive outlook or trend in the market, in which prices are expected to rise.

Bearish: It is a negative outlook or trend in the market, in which prices are expected to fall.

Bid (Purchase Price): It is the price at which a buyer is willing to acquire a financial asset in the market.

Brokerage: It is the service provided by a broker to facilitate the purchase and sale transactions of financial assets.

Base currency: The currency used as a reference to quote the value of other currencies in a currency pair. For example, in the EUR/USD pair, the euro is the base currency.

Breakout: It is the movement of a price that breaks a key resistance or support level, which can indicate a change in the market trend.

Balance: The total value of funds in a trading account, taking into account both realized and unrealized gains and losses.

Backtesting: It is the process of testing a trading strategy using historical data to evaluate its past performance and verify its viability.

Bull Market: It is a market in which the prices of financial assets are in a sustained upward trend.

Bear Market: It is a market in which the prices of financial assets are in a sustained downward trend.

Candlestick: It is a graphic representation of the price movement of an asset in a certain period of time. Japanese candles show the open, close, high and low of the price.

Commission: It is the fee or charge charged by a broker or trading platform for executing a transaction for the purchase or sale of financial assets.

Quote: It is the current price at which a financial asset is being traded in the market.

Contract: It is a standardized agreement that establishes the terms and conditions for buying or selling a financial asset at a predetermined future date.

Trading account: It is an account that a trader opens with a broker or platform to carry out purchase and sale transactions of financial assets.

Short (Short position or short sale): It is a trading strategy in which a trader sells a financial asset that he does not own, with the expectation of repurchasing it at a lower price in the future.

Hedging: It is a strategy that consists of opening a position to compensate or reduce the risk of another open position.

Market capitalization: It is the total market value of a company or financial asset, calculated by multiplying the current price by the number of shares in circulation.

Credit (Margin): It is the amount of money or margin that a broker can lend to a trader to operate with leverage.

Correlation: The relationship between two or more financial assets in terms of how they move in relation to each other. price at which a buyer is willing to acquire a financial asset in the market.

Day Trading: It is a trading strategy in which positions are opened and closed within the same day, without leaving operations open overnight.

Divergence: It is a situation where the price of an asset moves in one direction while a related indicator or oscillator moves in the opposite direction. It may indicate a possible change in the trend.

Dividend: It is a distribution of a company's profits to its shareholders in the form of periodic payments. Dividends are often an important part of stock investments.

Drawdown: The maximum decrease in the value of a trading account from its highest point to its lowest point, before recovering.

Slippage: It is the difference between the expected execution price of an order and the actual price at which it is executed due to market volatility and liquidity.

Doji: It is a Japanese candlestick formation in which the opening price and closing price are practically the same, creating an appearance of a cross or an equal sign (=). It may indicate indecision in the market.

Demand (Bid): It is the amount of an asset that buyers are willing to purchase at a specific price in the market.

Deposit (Margin): It is the amount of money required to open or maintain a leveraged position in the market. Also known as margin.

Dark Pool: It is a private trading system used by financial institutions and large investors to carry out operations outside the open market and without revealing details such as price and volume to the public.

Derivative: It is a financial instrument whose value is based on an underlying asset, such as stocks, indices, raw materials or currencies. Derivatives can be used to speculate on price movements or to hedge risks.

Base Currency: The first currency in a currency pair in the Forex market, which represents the base value of the pair.

Quote Currency: The second currency in a currency pair in the Forex market, representing the relative value against the base currency.

Execution: It is the process of carrying out an order to buy or sell a financial asset in the market.

Equity: The current value of a trading account, taking into account the balance, profits and unrealized losses.

Stochastic (Stochastic): It is a technical indicator used to measure the speed and momentum of a price. Helps identify overbought and oversold conditions in the market.

Expiration: The date and time at which a futures contract or option expires and is no longer valid.

Exchange: It is a market where financial assets are traded, such as stocks, currencies, cryptocurrencies, among others.

Strategy: It is a plan or set of rules that a trader follows to make trading decisions and manage their operations.

Equity Curve: A graphical representation of the growth or decline in the value of a trading account over time.

EMA (Exponential Moving Average): It is an exponential moving average, a technical indicator used to smooth the price and identify trends.

Elliott Wave Theory: It is a theory that suggests that the prices of financial assets move in repetitive and predictable wave-like patterns.

Entry: It is the point or level at which a trader decides to open a buy or sell position in a financial asset.

Fibonacci Retracement: It is a tool used in technical analysis to identify possible levels of correction or reversal of a trend based on Fibonacci ratios.

Forward Testing: It is the process of testing a trading strategy in real time using current data to evaluate its performance and effectiveness.

Fundamentals: Refers to the economic, financial and market factors that affect the value and performance of a financial asset.

FOMO (Fear of Missing Out): It is the fear of missing out on an investment opportunity when you see that other investors are making profits.

Floating Profit/Loss: This is the unrealized gain or loss from an open position that has not yet been closed.

Fill or Kill: It is an instruction given by a trader to execute an order to buy or sell a financial asset immediately or cancel it completely.

Fundamental Analysis: An analysis approach that evaluates the economic, financial and market fundamentals of an asset to determine its intrinsic value and growth potential.

Futures Contract: It is a standardized contract that obligates the parties to buy or sell a financial asset at a future date and at a price agreed upon in advance.

Fill Price: It is the price at which an order to buy or sell a financial asset is executed.

Forex (Foreign Exchange): It is the decentralized global market where the different currencies of the world are traded. Forex is the largest and most liquid market in the world.

Gap: It is a gap in the price chart that occurs when the opening price of an asset is significantly different from the previous closing price, creating an empty space on the chart.

Going Long: It is the action of purchasing a financial asset with the expectation that its price will increase to obtain profits.

Going Short: It is the action of selling a financial asset that is not owned with the expectation of repurchasing it at a lower price in the future, obtaining profits from the fall in prices.

Good Till Canceled (GTC): It is a type of order that remains active until it is completed or until the trader cancels it manually.

Gross Profit: It is the gross profit obtained from a trading operation, calculated by subtracting the acquisition cost of the asset from the sale price.

Golden Cross: It is a bullish technical signal that occurs when the short-term moving average crosses above the long-term moving average on a price chart.

Grid Trading: It is a strategy in which a trader establishes a series of buy and sell orders at different price levels, creating a “grid” to take advantage of market movements.

Candlestick chart: It is a type of chart that shows the price fluctuation of an asset using Japanese candlesticks, providing information about the open, close, high and low of the selected time period.

Gamma: It is a measure that indicates the sensitivity of an option to changes in the volatility of the underlying asset.

Gross Margin: It is the gross margin obtained from a trading operation, calculated by dividing the gross profit by the total income.

Hedge: It is a strategy used to reduce or offset the risk of loss in an open position by opening a contrary position in another related asset or instrument.

High: It is the highest price reached by a financial asset during a specific period of time.

Holding Period: It is the time during which a trader or investor maintains an open position in an asset before closing it.

Hammer: It is a candlestick formation that has a small body near the lower end and a long upper shadow, which indicates a possible bullish reversal in price.

Hard Stop: A predetermined price level set by a trader to automatically close a position if the price reaches that level, regardless of market conditions.

High-Frequency Trading (HFT): It is a trading style that uses computerized algorithms and systems to carry out buying and selling operations in fractions of a second, taking advantage of small profit opportunities.

HODL: It is a term used in the cryptocurrency community that means “Hold On for Dear Life.” It refers to the strategy of holding cryptocurrencies for the long term, regardless of short-term price fluctuations.

Hot Market: This is a market in which high trading volume and increased activity occurs, which can generate trading opportunities.

Halt (Suspension): It is the temporary interruption of trading in a market or financial asset due to abnormal conditions or exceptional situations.

Historical Volatility: It is a statistical measure that indicates the variability of the prices of a financial asset in the past, using historical data.

Indicator: It is a tool used in technical analysis to analyze market data and generate buy or sell signals. Indicators can be based on price, volume or other data.

Intraday: Refers to operations that are opened and closed on the same day. Day traders look to take advantage of short-term price fluctuations.

IPO (Initial Public Offering): It is the initial public offering of shares of a company in the market. It is when a company issues shares for the first time for the public to buy.

Index: It is a statistical measure that represents the overall performance of a group of stocks, bonds or other financial assets. Indices are used to track the performance of the market as a whole.

Investment: It is the action of placing money in a financial asset, such as stocks, bonds or real estate, with the expectation of obtaining long-term profits.

Long-term investing: It is an investment strategy in which positions are held for an extended period, usually years, with the goal of long-term profits.

Short-term investing: It is an investment strategy in which positions are held for a short period, usually days or weeks, with the aim of making quick profits.

In the Money: Refers to an option that has intrinsic value. In the case of a call option, it means that the strike price is less than the current price of the underlying asset. In the case of a put option, it means that the strike price is greater than the current price of the underlying asset.

Compound interest: It is the process of reinvesting profits earned from an investment to generate more profits over time.

JPY (Japanese Yen): It is the code for the Japanese currency, the yen. It is widely used in the foreign exchange market (Forex) and in international transactions.

Jobber: It is a term used in some financial markets to refer to a trader who carries out short-term buying and selling operations, taking advantage of small price fluctuations to obtain quick profits.

J Curve: It is a graphical representation of the evolution of the profits or losses of an investment over time. Initially, it may show losses before profits start to increase.

Joint Account: It is a trading or investment account that is shared by two or more people, who have access and control over the funds and operations carried out in the account.

Junior Traders: They are beginner or lower level traders in a company or financial institution. Junior traders are usually in a stage of learning and developing skills under the supervision of more experienced traders.

Long-term: Refers to an investment strategy or position that is held for an extended period, usually several years, with the expectation of long-term profits.

Limit Order: It is an instruction given by a trader to buy or sell an asset at a specific price or better. The order is executed only if the price reaches the specified level.

Liquidity: Refers to the ability of a financial asset to be bought or sold quickly and with minimal impact on the price. Liquid assets are easy to convert into cash.

Long Position: It is the purchase of a financial asset with the expectation that its price will increase to obtain profits.

Leverage: The use of borrowed capital, such as margin, to amplify the potential for profit or loss on a trade. It allows traders to control a greater amount of assets with less capital of their own.

Lot Size: The specific amount of financial assets included in a transaction. In the foreign exchange market, a standard lot usually represents 100,000 units of the base currency.

Limit Move: A limit set by an exchange or market to prevent excessive price movements in a given time period. During a limit move, no trades can be made beyond the set limit.

Loss Aversion: It is the psychological bias that leads investors to feel more pain from losses than pleasure from gains. Investors tend to be more cautious and avoid risks to avoid losses.

Long-Term Capital Gain: This is the gain obtained from the sale of an asset that has been held for more than one year. In some countries, long-term capital gains may receive more favorable tax treatment.

Lock-In: It is the act of securing or protecting a profit made by closing a position and locking in the profit before the market changes direction.

Lot: A standard unit of measurement used in trading to represent the amount of a financial asset in a transaction.

Market Order: It is an instruction given by a trader to buy or sell an asset at the current available market price. The order is executed immediately at the best price available at that time.

Margin: The additional capital required by a broker to open a leveraged position. It allows traders to trade with greater market exposure using borrowed capital.

Margin Call: It is a notification that a broker sends to a trader when the margin in their account falls below the minimum required level. The trader is required to deposit more funds or close positions to meet margin requirements.

Moving Average: It is a technical indicator that shows the average of the prices of an asset during a specific period. It is used to identify trends and buy or sell signals.

Market Cap: It is the total market value of a company or cryptocurrency, calculated by multiplying the current price by the total number of shares or units in circulation.

MACD (Moving Average Convergence Divergence): It is a technical analysis indicator that shows the relationship between two moving averages of the price of an asset. It is used to identify possible turning points in a trend.

Momentum: It is the measure of the momentum or force behind the price movement of an asset. Traders use momentum to identify trends and determine the likelihood that they will continue or reverse.

Market Volatility: It is the measure of the speed and magnitude of changes in market prices. High volatility indicates larger and faster price movements, while low volatility indicates more stable movements.

Market Maker: An entity, usually a financial institution, that provides liquidity in a market by quoting buy and sell prices for a financial asset. Market makers help maintain the fluidity of operations.

Mutual Fund: It is a form of collective investment in which investors contribute their money into a common fund managed by a management company. The fund invests in a diversified portfolio of assets, such as stocks and bonds.

Nasdaq: It is an electronic stock exchange in the United States, known for listing mainly shares of high-tech companies and the computer sector. It is one of the largest stock exchanges in the world.

NYSE (New York Stock Exchange): It is the New York Stock Exchange, the largest stock exchange in the United States and one of the most important in the world. Numerous shares of leading companies are listed there.

Algorithmic trading: It is the use of computer algorithms to carry out operations in the market in an automated manner. Algorithms execute buy or sell orders based on predefined conditions.

Resistance Level: It is a price level at which supply is expected to be stronger than demand, which may make it difficult for the price to break above that level. Resistance levels are often seen as barriers to upward price movement.

Support Level: It is a price level at which demand is expected to be stronger than supply, which may prevent the price from falling below that level. Support levels are often considered areas where buyers can enter the market.

Nikkei: It is an index of the Tokyo Stock Exchange that tracks the performance of 225 leading companies in the Japanese stock market. The Nikkei 225 is one of the most important indices in Japan and is used as an indicator of the Japanese market in general.

Non-Farm Payrolls: An economic report published monthly in the United States that shows the change in the number of non-farm employees over the previous month. It is an important indicator of the health of the labor market and can affect market movements.

Nominal Value: The nominal value of a stock, bond or other financial instrument, which is established when the instrument is issued. Often, the nominal value is different from the current market value of the asset.

Net Asset Value: It is the total value of the assets of an investment fund, divided by the number of shares in circulation. The net asset value per unit is used to determine the purchase or sale price of the fund's units.

Market news: These are events, reports or announcements that can have a significant impact on the prices of financial assets. Market news may include economic reports, political decisions, corporate earnings releases, among others.