This is the day an option or futures contract expires. In option trading, investors have the ability of purchasing options. When the purchase is complete, the option or futures contract gives investors the right to purchase or sell assets at a pre-determined price within a particular time. This value is called the strike price. […]
Results for: Day Trading Terminology
Beta Definition: Day Trading Terminology
As a numeric value, it is used to measure the fluctuation of a stock against changes happening in the stock market. Beta is also defined as a systematic risk measure of a security in comparison to the market. The value is commonly used in capital asset pricing model. It helps to determine the expected return […]
Time In Force “TIF” Definition: Day Trading Terminology
Time In Force is the amount of time spent during the execution of an order before it expires. It also refers to a special directive implemented by traders or investors when placing a trade for stocks or other financial instruments. As a result, it gives the trader or investor a mechanism of controlling time for […]
Arbitrage Definition: Day Trading Terminology
This refers to a profit making activity where buying and selling of a security is done on different exchanges or markets. It can also be defined as the practice of buying an asset and selling it immediately at a higher price on a different exchange. According to savvy investors, arbitrage is the practice of leveraging […]
Short Sale Rule “SSR” Definition: Day Trading Terminology
What is a Short Sale Rule? This is an SEC rule where short sales are only executed on an uptick or when someone pays up to your price where your short order is; you can’t hit the bid on a stock with an SSR. According to the SEC, a short sale refers to the sale […]
One Triggers Other Order Definition: Day Trading Terminology
This is a contingent order where by primary and secondary orders are created. When the primary order executes, the secondary order is triggered automatically. This means that the secondary order will become active and follow conditions set for its execution. OTO saves time for the trader since traders can purchase a certain amount of options […]
Parabolic Indicator: Day Trading Terminology
This refers to a technical analysis strategy that utilizes trailing stop and reverse method in order to determine entry and exit points. It is also defined as a price and time analysis measure used to identify points pertaining to stops and reverses. Also referred to as a Stop And Reverse method, it was developed by […]
One Cancels Other Order (OCO): Day Trading Terminology
What is a One Cancels Other Order? This refers to a situation where two orders are made and if one of the orders is executed, the other is cancelled automatically. OCO is known to combine a stop order with a limit order on an automated trading platform and that is why it’s used by seasoned […]
Trailing Stop Definition: Day Trading Terminology
This is a special trade order that disallows the setting of the stop-loss price as a single absolute dollar amount but allows the setting of the value as a percentage usually below the market price. The percentage value helps to track the securities price direction automatically and does not require any manual reset. A trailing […]
Gap And Go Strategy: Day Trading Terminology
For day traders to achieve success in the market, a sound strategy is required. For profits to be realized, discipline is needed. One of the best strategies that has proven to work over time is the Gap and Go strategy. To understand what Gap and Go strategy is all about, you need to understand some of its […]