Trading Basics
Gearing
Another name for leverage. Debt to equity proportions on a trade or portfolio.
Other Trading Basics
Cable
Another name for the GBP – USD exchange.
Around half a trillion dollars is traded between the two currencies everyday, making it the third most popular currency pair to trade in behind EUR – USD and USD – JPY.
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.
Circuit Breaker
When exchanges stop the trading in a security that has fallen significantly.
This is done to stop an uncontrollable panic.
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