Trading Basics
Warrant
The right to buy new shares at a set price in a company at a future point in time. Similar to an option which gives similar right but over existing shares.
Other Trading Basics
Backwardation
Backwardation occurs when a bid price exceeds the ask price.
This usually occurs when stock is suspended or under a share repurchase scheme.
It can also mean that a futures contract will trade at a higher price when it is coming close to expiring.
The opposite of backwardation is known as contango.
Candlestick Chart
A type of chart using a security’s opening, closing, high and low price for a particular period.
Closing Trade
A trade to close a position. Most trading requires the trader to place the opposite trade to that done when opening their position.
This will crystallise the profit or loss.
Start learning
Learn the skills needed to trade the markets on our Trading for Beginners course.
