Trading Basics
Collateral
The resources put up by the trader to enter a trade.
Requested by the counterparty and normally in the form of cash but sometimes other liquid assets like shares.
Other Trading Basics
Annuity
A guaranteed income for the rest of someones life.
Historically purchased with pension lump sums.
The buyer is swaping cash now for future income.
Commission
A charge levied on a client to place trades in certain asset types. FX and CFD trading attracts commission.
Close A Position
When a trader places a trade to reduce their position to zero.
They are closing their position.
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