Basic Terms
Ask Price
The ask price is the lowest price a seller is willing to accept for a financial instrument. Also known as the offer price, it is one half of a currency quote.
Balance
Account balance is the total cash in your trading account, excluding any open positions. It reflects deposits, withdrawals, and realized profit/loss.
Bear Market
A bear market is a sustained period of declining prices, typically defined as a drop of 20% or more from recent highs. Characterized by pessimism and negative investor sentiment.
Bid Price
The bid price is the highest price a buyer is willing to pay for a financial instrument. It represents the demand side of a market quote.
Broker
A broker is a financial intermediary that facilitates trades between traders and the market. In forex, brokers provide trading platforms, liquidity, and leverage.
Bull Market
A bull market is a sustained period of rising prices, typically defined as an increase of 20% or more. Characterized by optimism, strong economy, and high investor confidence.
CFD (Contract for Difference)
A CFD is a derivative contract that lets traders speculate on price movements without owning the underlying asset. Popular for forex, stocks, commodities, and indices.
Commission
Commission is a fee charged by brokers for executing trades. It can be a flat rate per lot, a percentage of trade value, or built into the spread.
Currency Pair
A currency pair quotes two currencies against each other in forex trading. The first is the base currency, the second is the quote currency.
Demo Account
A demo account is a practice trading account with virtual money. It replicates real market conditions, allowing traders to test strategies risk-free.