Glossary
Popular definitions
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Bank for International SettlementsThe Bank for International Settlements (BIS) is a global financial institution owned by central banks. Based in Basel, Switzerland, there are representative offices in Hong Kong and Mexico City.
The BIS's original members were Switzerland, Germany, Belgium, France, Britain, Italy, the United States and Japan. -
Bank of ChinaThe Bank of China is one of China's four largest state-owned commercial banks. It is a subsidiary of the People’s Bank of China. However, it maintains close relations in management, administration, and cooperation in several areas with the subsidiary.
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Bank of EnglandThe Bank of England (BoE) is the central bank for the United Kingdom, acting as the government's bank and lender of last resort. With headquarters in the City of London, it issues currency and oversees monetary policy. It is the UK equivalent of the Federal Reserve in the United States.
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Bar chartA type of chart which consists of four significant points: the high and the low prices, which form the vertical bar; the opening price, which is marked with a horizontal line to the left of the bar; and the closing price, which is marked with a horizontal line to the right of the bar.
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Barrier levelA certain price of great importance included in the structure of a barrier option. If a barrier level price is reached, the terms of a specific barrier option call for a series of events to occur.
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Barrier option definitionA barrier option is a type of options contract which has a payoff dependent on whether or not the market reaches – or exceeds – a predetermined price, known as a barrier level.
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Base rateThe base rate, or base interest rate, is the interest rate that a central bank – like the Bank of England or Federal Reserve – will charge to lend money to commercial banks. Adjusting the base rate helps a central bank regulate the economy by encouraging or discouraging spending as required.
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BasingA chart pattern used in technical analysis that shows when demand and supply of a product are almost equal. It results in a narrow trading range and the merging of support and resistance levels.
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Bear marketA bear market is any market that experiences a fall of around 20% or more from its recent high. Most commonly applied to stock markets, the term can also be used for anything that is traded, including currencies and commodities. A bear market is the opposite of a bull market.
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Bid priceBid price, or simply bid, describes what a buyer is willing to pay for a security. It is contrasted with the ask price, the amount a seller is willing to sell a security for. The difference between the two is known as the ‘spread’, which is the cost traders pay to open and close positions.
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Bid/Ask spreadThe difference between the bid and the ask (offer) price.
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Black boxThe term used for systematic, model-based or technical traders.
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Bollinger BandsA tool used by technical analysts that consists of a band plotted two standard deviations on either side of a simple moving average. It is used to find support and resistance levels.
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BondsA bond is a fixed-income investment that represents a loan made by an investor to a borrower (who is typically corporate or governmental). It can be illustrated as an I.O.U. between the lender and borrower that includes the details of the loan and its payments.
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BrokerA financial broker is a third-party coordinating the sale of financial securities between parties selling securities and those purchasing them. Brokers are individuals or firms acting as intermediaries between investors and trading exchanges.
Exchanges only accept orders from their members, either individuals or firms. Therefore, traders and investors require exchange members' services to make financial transactions. Brokers get compensated for their services in several ways; commissions, fees or paid directly by the exchange. -
BuckThe word buck is a slang term for one US dollar. The word’s use traces back to 1748, forty-four years before the first US dollar became minted.
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Bull marketA bull market describes any market in which prices are rising or are expected to rise imminently. Typically applied to stock markets, the term can also be used for anything that is traded, including currencies and commodities. A bull market is the opposite of a bear market.
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BuyTaking a long position on a product.
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Buy dips‘Buy the dips’ is a phrase used in trading, referring to opening a trade on a market as soon as it experiences a short-term price fall. ‘The dip’ is quite literally a dip shown on a market’s chart when its price falls after a bullish period.