Forex Dictionary ( K - P )

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• Leading index
  shows an average of leading economic indicators such as Factory Orders, Initial Jobless Claims, Money Supply, Average Workweek, Building Permits, quotes of common stocks, Durable Goods Orders and Consumer Confidence. The leading index is believed to predict the pace of economic growth over the next six months. The index is calculated at the beginning of every month and released at 10:00 EST (NY).
  
  
• Libor
  stands for London Interbank Offer Rate. Libor is a commonly recognized indicator of the cost of funds to banks. This is the rate that determines the cost of loans the world’s largest banks provide each other with on the London Interbank Exchange. Libor is one of the most widely used benchmarks for short-term interest rates. At present, it fixes rates for EUR, USD, GBP, JPY, CHF, CAD, AUD, DKK, and NZD. Libor is calculated for various borrowing periods, ranging from overnight to one year.
  
  
• Light Sweet
  is a standard oil brand which is extracted in Texas (the USA). Due to low content of sulfur and relatively high output of useful products, it is used mainly for gasoline processing. This kind of oil is in high demand in the USA and China. Light Sweet Crude Oil is a pricing benchmark for world types of oil. It is traded on NYMEX (New York Mercantile Exchange).
  
  
• Limit order
  is a type of a pending order (see pending order) that enables entering the market at the given potentially important level after which the reversal is expected. Limit order types are Buy limit and Sell limit
  
  
• Liquidity
  is the degree to which an asset (currency, security, etc.) can be sold at the current market price. This term refers to market volatility and dynamics: a liquid market is a type of a market with large trading volumes where every trade incapable of making a significant impact
  
  
• Long position
  is the buying of a financial instrument
  
  
• Loss
  is the fixed loss on the position
  
  
• Lot
  is a trading unit on the market; the standardized quantity of goods making up a transaction, exchange-traded securities, a certain amount of currency on Forex. Lot also represents the trade volume (position, order)
  
  
• Lot Size
  a quantity base currency in one lot, that is specified in the contract
  
  
• M&A (Mergers and Acquisitions)
  is a buyout market. It is highly developed in the USA and in Euro area where in the history of every company information about its merging and absorption with other companies is stated.
  
  
• Margin
  the required equity which an investor must deposit to collateralize a position equal to 1% (when leverage = 1:100) of an open position deposit
  
  
• Margin level
  determines the condition of an account. Calculated according to the formula: (Equity / Margin) * 100%
  
  
• Margin trading
  using borrowed money to buy securities, with the expectation of increasing profits. Margin trading can bring big returns, but is also risky
  
  
• Mario Draghi
  is an Italian economist. He has been the ECB President since 2011. He also headed the Bank of Italy from 2005 to 2011.
  
  
• Market opening
  trade opening after a weekend, holidays or after an interval between trading sessions
  
  
• Market opening price gap
  either of the following situations:
  – Market opening quote Bid is greater than market closing quote Ask;
  – Market opening quote Ask is less than market closing quoteBid
  
  
• Market price
  the last posted bid and ask prices for a given asset, currently valid on the market
  
  
• Market-makers
  major banks and financial firms that pledge to provide liquidity by accepting the other side of a trade in a currency, security or futures contract
  
  
• MICEX (Moscow Interbank Currency Exchange)
  is a Russian stock exchange where papers of more than 700 issues with the total capitalization of 10 trillion rubles are trading.
  
  
• MSCI (Morgan Stanley Capital International)
  is a leading international analytical company which calculates global, national, and regional stock indices. Review of MSCI indices greatly influences stock markets.
  
  
• MSCI Asia Pacific
  is Morgan Stanley capitalization composite index which unites 15 countries of Asia-Pacific region. Index with the reading of 100 notched at the end of December, 1987 is considered to be standard.
  
  
• NASDAQ (National Association of Securities Dealers Automated Quotation)
  is the US stock market where shares of more than 4,000 hi-tech companies with the total capitalization of $6 trillion are trading.
  
  
• New York Stock Exchange (NYSE)
  is New York stock exchange where securities of more than 3,000 issues bodies are trading daily with the overall capitalization above $27 trillion.
  
  
• Nikkei 225 Stock Average
  is Japanese stock market index which represents an average of the most widely quoted Japanese equities of 225 companies of the first section of Tokyo stock exchange.
  
  
• Non-trading operation
  depositing or withdrawing funds from a trading account, or extending credit