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Glossary of Common Trading Terms
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Glossary of Common Trading Terms

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@ReFi HR

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Questions and Answers

What is the ask price in trading?

  • The highest price a buyer is willing to pay for a security
  • The lowest price a seller is willing to accept for a security (correct)
  • The current market price of a security
  • The average price of a security over time

    • What does arbitrage involve in trading?

  • The long-term investment in a security
  • The simultaneous purchase and sale of an asset in different markets to profit from price discrepancies (correct)
  • The analysis of market trends
  • The purchase of securities based on company fundamentals

    • What is the bid price?

  • The lowest price a seller is willing to accept
  • The highest price a buyer is willing to pay for a security (correct)
  • The average price over a week
  • The last traded price

    • What characterizes a bull market?

    <p>Rising prices and investor optimism</p> Signup and view all the answers

    What characterizes a bear market?

    <p>Falling prices and investor pessimism</p> Signup and view all the answers

    What is a call option?

    <p>A financial contract giving the holder the right, but not the obligation, to buy an asset at a specified price within a specified period</p> Signup and view all the answers

    What does a candlestick chart represent?

    <p>Price movements over time using candlestick-shaped figures to show open, high, low, and close prices</p> Signup and view all the answers

    What is a commission in trading?

    <p>A fee charged by a broker for executing a trade</p> Signup and view all the answers

    What defines a market correction?

    <p>A decline of 10% or more in the price of a security or market index</p> Signup and view all the answers

    What is day trading?

    <p>The practice of buying and selling financial instruments within the same trading day</p> Signup and view all the answers

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