Forex Tests Flashcards
What is the meaning of the term ‘going long’
What is the meaning of the term ‘going short’
Speculating that the base currency will rise.
Speculating that the base currency will fall.
What is a ‘lot’?
A unit of measurement for the amount of currency you buy or sell.
What are the different types of lots?
Standard, Mini & Micro
What is a standard lot?
A standard lot is equivalent to 100,000 units of the base currency
(E.G If trading EUR/USD one standard lot is €100,000)
What is a mini lot?
A mini lot is equivalent to 10,000 units of the base currency
(E.G If trading EUR/USD one standard lot is €10,000)
What is a micro lot?
A micro lot is equivalent to 1,000 units of the base currency
(E.G If trading EUR/USD one standard lot is €1,000)
What does ‘pip’ stand for?
Percentage in Point
What is the value of a pip in a standard lot, mini lot and a micro lot?
Standard Lot: $10
Mini Lot: $1
Micro Lot: $0.10
What is a pip?
A pip is the smallest price movement that a currency pair can make.
Pips are used by traders to measure price movements and to express the amount of profit or loss on a trade.
What is ‘slippage’?
Slippage is the difference between the price you expect and the price you actually get when your trade is executed
What are the 3 categories of currency pairs?
- The ‘Majors’
- The ‘Crosses’
- The ‘Exotics’
What do ‘Major’ currency pairs always include?
The U.S Dollar.
What are ‘Exotic’ Currency pairs?
They consist of one major currency and one currency from an emerging market.
What are ‘Cross-currency’ pairs?
currency pairs that do NOT include the U.S Dollar.
What are cross currency pairs that involve any of the major currencies also known as?
minors
What are the nicknames given to the country codes ‘SEK’ & ‘NOK’ and what country do they represent?
‘Stockie’ - Sweden
‘Nockie’ - Norway
What are CEE Currencies?
Central & Eastern European Countries
What are the main four CEE currencies to be aware of?
Hungary - HUF
Czech Republic - CZK
Poland - PLN
Romania - RON
What is ‘BRIICS’? + What countries are involved?
An acronym given for the association of 6 major emerging national economies
Brazil, Russia, India, Indonesia, China & South Africa
What are currency options?
An “option” is a financial instrument that gives the buyer the right or the option, but not the obligation, to buy or sell an asset at a specified price on the option’s expiration date
What is a swap/rollover fee?
A fee paid/earned for the procedure of moving an open position from one trading day to another is called a rollover.
