Trading Glossary Explained

Trading is a complex process, which includes many actions that a person unfamiliar with the financial world will find puzzling. Once you launch your trading career, you will be swamped with trading terms whose meaning you will not know. You will not immediately grasp how the market value of a business differs from its book value. Nor will you understand what CPI stands for and how it is different from IPO, unless we supply you with a glossary of all confusing terms that you meet in a trading business.

To help you avoid confusion, we have compiled a comprehensive glossary of financial terms used in the markets. All trading glossary is presented in our glossary in alphabetical order and is explained with linguistic precision. Any financial term that sounds baffling at you now will become crystal clear once you read its definition in our glossary below.

All | # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

There are currently 9 names in this directory beginning with the letter M.

Margin

In trading, this term refers to the funds which are required to open and maintain a leveraged position.

Market Capitalization

Often shortened as market cap, this term refers to the total market value of a company’s shares on the market. It is an easy way to determine a company’s size, which, in turn, helps assess the risk of investing in its shares.

Market Data

It is the live streaming of all information related to trade. It includes information about price, bid/ask quotes, and market volume. Market data also encompasses reports on assets and financial instruments. Market data is available across all global markets – stocks, forex, and commodities, and is distributed to companies and individual traders.

Market Order

It is an instruction from a trader to a broker to execute a trade immediately at the best available price.

Market Value

This value reflects what a business is worth according to market participants.

Merger

This term is used to describe two companies’ decision to combine and become one entity.

MetaTrader

It is an electronic trading platform popular among traders around the world.

Moving Average (MA)

It is a common indicator in technical analysis, used to analyze price movements of assets while lessening the impact of random price spikes.

Multiplier Effect

This term describes the impact that changes in monetary supply have on economic activity. When a government, business, or individual spends money, it can have an unforeseen effect on businesses and people.