Trading Basics
Basis point
A basis point is 0.01% and is typically used when quoting interest rate changes.
A move of 0.25% is described as 25 basis points.
Other Trading Basics
Cost of Carry
The cost to a trader of maintaining a position. This might be in form of overnight financing on simple CFD trades but can also include the costs to insure, transport or finance on more complex trades.
Acquisition
When the majority of shares changes hands in a company.
This is typically when one company buys another.
Close to the Money
In options trading when the underlying price of the security is close to the strike price of the option.
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