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Expert Glossary


Ask (offer) – price of the offer, the price you buy currency for.

Bid – price of the demand, the price you sell currency for.

Broker – is a company that acts as the middleman between trader and larger commercial institution.

Commission – certain amount of money that broker takes for operation handling.

EA (expert advisor) or Robot – an automated script, that was written by professional trader and used by the trading platform to manage buy/sell orders automatically.

Flat (square) – neutral state, when all your positions are closed

Leverage – use of borrowed capital, allowing the Forex trader to gain access to larger sums of capital. This can heighten profits and losses and should be used wisely.

Floating leverage – a leverage that changes depending on the total size of open positions.

Gap – a difference between the previous period’s price and the next open price. It usually happens during weekends – between the Friday’s close and the Monday’s open price.

Lot – a definite amount of money for every operations handled (usually it is a multiple of 100)

Margin – money that is not involved in trading and you can use it to take more positions.

Margin call – is a situation when your margin deposits have fallen below the required minimum level.

Order (trade) – an order for a broker to buy or sell a currency at a certain rate.

Pip (point) – the last digit in a currency rate (e.g. EUR/USD = 0.0001)

Profit (gain) – positive amount of money that you earn for closing the position.

Scalping – a special type of trading, where a big number of positions are opened for short-term profits.

Stop-loss order (SL) – an order to close a deal when the market reaches a certain rate.

Slippage – execution of an order at a rate different from ordered.

Spread – a difference between ask and bit rates of a currency pair.

Swap – an overnight fee for holding a position in Forex.

Trend – a market’s direction established under an influence of different factors.

Volatility – a statistical measure of the number of price changes for a given currency pair in a given period of time.

VPS (Virtual Private Server) – a virtual space hosted on a dedicated server, used to run programs independent on the user’s PC.


This information has been prepared by Forex41. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Forex41 accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our members.

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