Glossary › General

Trading glossary

General words

29 words, each explained first as you would tell a ten-year-old.

1. assetSomething valuable you can own or trade, like shares, coins, gold or money.
2. brokerA company that lets you buy and sell in the markets and looks after your account.
3. buyersThe people trying to buy. When they push harder than the sellers, price goes up.
4. chartA picture of how a price has moved over time, usually drawn with candles.
5. day traderSomeone who buys and sells within the same day and closes everything before the day ends.
6. entryThe moment and the price at which you start a trade.
7. filterA rule that sorts out the weaker chances so you only look at the better ones.
8. forecastA guess about a future number, like tomorrow's weather, made before the real number is known.
9. historical dataOld prices from the past, used to test how a trading idea would have done.
10. instrumentAnything you can trade, like a share, a coin or a pair of currencies.
11. investorA person who buys things like shares to hold them for a long time, hoping they grow in value.
12. long positionBuying something because you think its price will go up, planning to sell it later for more.
13. marketA place where buyers and sellers trade something, like shares, coins or money from other countries.
14. market conditionWhat the market is doing right now, like moving steadily one way, moving sideways, being calm or being wild.
15. orderAn instruction you send to buy or sell, such as 'buy 10 shares now' or 'sell if price drops to here'.
16. portfolioAll the investments or trades you hold together at one time.
17. positionA trade you have open right now, like owning some shares you bought.
18. priceHow much something costs right now: the amount buyers and sellers agree on in a trade.
19. probabilityHow likely something is to happen, like a 60% chance of rain. It is a chance, not a promise.
20. sample sizeHow many examples your results come from. More examples make a result more trustworthy.
21. scannerIn this app, the tool that searches real charts for chart shapes and records what happened after each one.
22. sellersThe people trying to sell. When they push harder than the buyers, price goes down.
23. setupA situation on the chart that matches the kind of trade your plan is looking for.
24. short positionA trade that makes money if the price goes down, by selling first and buying back later.
25. signalA clue on the chart that hints at what price might do next. It is a hint, not a promise.
26. simulated tradingPractising trading with pretend money, like in this app, so you can learn without losing real money.
27. traderSomeone who buys and sells to try to profit from price moves.
28. trading accountThe account that holds the money you use to trade.
29. trend followingA way of trading that rides the main direction of price instead of guessing when it will turn.