Trading Glossary

Take a look at our list of the financial terms associated with trading and the markets.

Refers to the time difference between the users action and when it gets executed into the market. In financial markets, prices change in ticks, so the lower the delay, the better you can take advantage of trading opportunities. Especially for high-frequency traders, every millisecond movement of the price is crucial. The best brokers build their technology stack with the best equipment and network technology to allow a low-latency trading environment. 

Leading Indicators

It mainly refers to the economic indicators that reflect prosperity in advance and are used to predict the future trend of the boom, and its turning point often occurs before the turning point of the boom cycle, such as the number of initial unemployment benefits in the United States. However, which indicators are considered leading indicators, there is no clear definition. At present, the main reference indicator is the Leading Economic Index, which is an index composed of 10 leading indicators of the US Economic Consultative Council's changes in the economy. 


Leverage itself is a technique for investors to increase their own purchasing strength through borrowed funds, if the investor itself is only 1 million, but can buy 10 million assets, then its own leverage multiple is 1000/10 = 10 times, but the leverage is often a double-sided blade, potentially increasing profits at the same time, but also has the possibility of allowing investors to suffer serious losses faster. 


The call rate commonly used among large international banks. Due to its liquidity advantages and the fact that interest rates are determined by the market, LIBOR is often used as a benchmark for the interest rates of commercial loans, mortgages and bonds issued, and also as a benchmark for many institutions to value risk assets.  

Lightning Network

Bitcoin is the most criticized point is the transaction performance, the whole network 7 transaction speed per second, the concept of lightning network is born in response, the main idea is very simple, by putting a large number of transactions outside the Bitcoin blockchain, it cannot occupy the main chain resources, improve transaction speed, reduce fees and protect user privacy and other advantages.  


1) Closing out a position, converting assets into cash. 2) Action taken by margin department when a client has not paid for a purchase.

Liquidity Coverage Ratio

Refers to the ratio of current assets to cash inflows over the next 30 days, which generally needs to be higher than 100%. This indicator, which is generally used for liquidity regulation of financial institutions, originated in Basel III after the financial crisis and is used to measure whether banking institutions can maintain high-quality liquid assets at a reasonable level in the face of severe liquidity pressures.  

Liquidity Provider

Since some financial transactions (such as foreign exchange transactions) are over-the-counter transactions, they need to be matched through intermediate links. One of the intermediate links is the liquidity provider, which can also become a market maker. Liquidity providers get data on market buying and selling needs and make quotes through statistics, linking buyers to sellers. Liquidity providers generally dock with brokers, and brokers go back to dock buyers and buyers. 

Liquidity Trap

It refers to the macroeconomic environment in a severe depression, the policy is in a long-term high liquidity environment (interest rates can no longer be low, zero interest rates or negative interest rates), resulting in monetary policy losing its role in stimulating the economy. The reason why it is a trap is that once the national economy is stuck in this quagmire, it is difficult to get out, neither to expand the easing nor to tighten the policy. 


A long position is a buy-hold that is bullish on the future growth of a commodity such as an index or foreign exchange and waits for the profit to rise. Commodity prices rise and long positions take profits; Commodity prices fall and long positions lose. 

Long Candle

Indicates that the body length of a single K-stick is greater than normal. The body of the candlestick depends on the distance between the opening price and the closing price, and the greater the distance, the stronger the force in a certain direction in the market. For example, the appearance of a long solid Yang line indicates that the price has strong buying support near the opening price, and the market is biased towards the bulls. 

Long Term Trading

One of the types of trading strategies, a trader will hold a position for a longer period of time, generally index months or years. Long-term traders do not pay attention to short-term fluctuations in prices, similar to the trading method of investment, ignoring the short-term "noise" in the market. 


Common units in Forex trading. Generally speaking, taking 100,000 base currency as 1 standard lot, for example, going long 1 standard Euro and Us currency pairs is equivalent to going long 1 00,000 euros. This unit measure was then extended to precious metals, commodities, and indices. Each type of commodity is in standard lots, for example 1 standard lot of gold represents 100 ounces of gold and 1 standard lot of silver represents 1000 ounces of silver.