Broker Glossary
Welcome to the FindBrokers Glossary — your go-to resource for understanding key trading and broker-related terms. Whether you're new to trading or an experienced investor, this glossary helps you learn important terminology and make smarter broker comparisons.
A
Ask Price
The lowest price a seller is willing to accept for an asset. Learn more
Asset Class
A category of financial instruments such as Forex, commodities, indices, or stocks.
B
Balance
The amount of money currently available in a trading account.
Bear Market
A market characterized by declining prices.
Bid Price
The highest price a buyer is willing to pay for an asset.
Broker
A firm or individual that executes trades on behalf of clients. Learn more
Bull Market
A market characterized by rising prices.
C
CFD (Contract for Difference)
A derivative allowing speculation on price without owning the underlying asset. Learn more
Commodities
Raw materials like gold, oil, or wheat traded in financial markets.
Copy Trading
A service that lets traders replicate the trades of professionals.
D
Demo Account
A practice trading account with virtual money.
Derivatives
Financial instruments whose value is derived from an underlying asset.
Drawdown
The peak-to-trough decline in account equity.
E
ECN Broker
A broker that routes client orders directly to the interbank market.
Equity
The value of funds in a trading account including unrealized profits/losses.
Execution Speed
The time it takes for a broker to complete a trade order.
F
FCA (Financial Conduct Authority)
The UK's regulator for brokers and financial services.
Forex (Foreign Exchange)
The global market for trading currencies.
Futures
Contracts to buy or sell an asset at a set price on a future date.
G
Gap
A sharp price move between trading sessions where no trades occur.
Guarantee Stop-Loss
A stop order that ensures execution at the exact price, even during volatility.
H
Hedging
A strategy to offset risk by taking opposite positions.
High-Frequency Trading (HFT)
Algorithmic trading using extremely fast order execution.
I
IB (Introducing Broker)
An intermediary who refers clients to a broker for commission.
Index
A benchmark representing a group of stocks, such as the S&P 500 or NASDAQ.
Inflation
The general increase in prices over time, reducing purchasing power.
Initial Margin
The minimum amount of funds required to open a leveraged position.
L
Leverage
Borrowed capital that allows traders to open larger positions. Learn more
Liquidity
How easily an asset can be bought or sold without affecting its price.
Long Position
Buying an asset with the expectation that its price will rise.
Lot
The standardized quantity of a financial instrument traded (e.g., 100,000 units in Forex).
M
Margin
The collateral required to open and maintain leveraged positions.
Margin Call
A broker's demand for a trader to deposit more funds to cover potential losses.
Market Maker
A broker or firm that provides liquidity by quoting both buy and sell prices.
Market Order
An order to buy or sell an asset immediately at the best available price.
MetaTrader 4 (MT4)
A widely used trading platform for Forex and CFDs.
MetaTrader 5 (MT5)
The updated version of MT4, supporting more instruments and advanced features.
N
Negative Balance Protection
A feature ensuring traders cannot lose more than their deposited funds.
Non-Farm Payroll (NFP)
A key U.S. economic report that often causes market volatility.
O
Order Book
A real-time list of buy and sell orders for a specific asset.
P
Pip
The smallest price movement in Forex trading, typically 0.0001 for major pairs.
Profit Margin
The percentage of revenue that remains as profit after expenses.
Q
Quote Currency
The second currency in a Forex pair, used to value the base currency.
R
Requote
When a broker offers a new price for an order due to market movement.
Rollover
The process of extending a position to the next trading day.
S
Scalping
A strategy involving many small, quick trades to capture tiny price movements.
Slippage
The difference between the expected and actual execution price of a trade.
Spread
The difference between the bid and ask price of an asset. Learn more
Stop-Loss Order
An order to automatically close a trade at a predetermined price to limit losses.
Swap
The interest charged or earned for holding a position overnight.
T
Take-Profit Order
An order to automatically close a trade when it reaches a desired profit level.
Technical Analysis
The study of price charts and indicators to predict future price movements.
V
Volatility
The degree of variation in asset prices over time.
VPS (Virtual Private Server)
A remote server used to run trading platforms 24/7 with low latency.
W
Whipsaw
When the market moves in one direction and quickly reverses.
White Label Broker
A broker using another company's infrastructure but operating under its own brand.
Y
Yield
The earnings generated from an investment over a period.
Z
Zero Commission Broker
A broker that does not charge commissions but may profit from spreads.
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