Traders Glossary

Explore, learn, and discover all trading-related terms here in our comprehensive glossary.

Mark to Market

The daily adjustment of margin accounts to reflect profits and losses in such a way that losses are not allowed to accumulate.

Market Capitalisation

The number of outstanding shares multiplied by the value per share.

Market if Touched (MIT) Order

An order that becomes a market order if the price specified is reached.

Market Maker

A trader or trading firm that buys and sells securities in a market in order to facilitate trading. Market makers make a two sided (bid and ask) market.

Market on Close Order

An order that requires the broker to achieve the best price at the close or in the last 5 minutes of trading.

Market on Open Order

An order that must be executed at the opening of trading.

Market Order

Trading securities immediately at the best market prices in order to guarantee execution.

Market Price

The most recent transaction price.

Modified Call Butterfly

A neutral to bullish strategy similar to a Long Call Butterfly except that the OTM bought calls have a strike price nearer to the central strike price of the sold calls.

Modified Put Butterfly

A neutral to bullish strategy similar to a Long Put Butterfly except that the ITM bought puts have a strike price nearer to the central strike price of the sold puts.

Momentum

Where a market direction (up or down) is established.

Momentum Indicators

Technical Analysis indicators using price movement and volume in order to determine market direction.

Momentum Traders

Traders who use momentum as their primary tool to invest.

Moving Average

The average of a security's (or index's) latest prices for a specific period of time (eg 50 days). Another technical analysis tool.

Mutual Fund

An open-ended investment fund that pools investors' contributions to invest in securities such as stocks and bonds.

Naked

Selling naked options refers to a sold options contract with no hedge position in place. Such a position leaves the option seller (writer) exposed to unlimited risk.

NASDAQ

National Association of Securities Dealers Automated Quotations system.This is a computerised system providing brokers and dealers with securities price quotes.

Near the Money (NTM)

Where the underlying asset price is close to the Strike Price of an option.

New York Stock Exchange (NYSE)

The largest stock exchange in the US.

Note

A short term debt instrument – they normally mature in or less than 5 years.