The Trader's Alphabet

The ADP Employment Change is an estimate of the change in U.S. Non-Farm Private Employment, the change of the number of people are currently employed in the private sector except farm workers, private household employees and non-profit organisation employees. The employment report is called ADP as it is produced by Automatic Data Processing Inc. (ADP). ADP is released two days before the official NFP report. A high reading is seen as positive for the USD while a low reading is seen as negative.

The average hourly payroll earnings is part of the U.S. Employment Report released the first Friday of each month along with the Non-Farm Payrolls.

Average number of working hours per week by employees in manufacturing. It is part of the U.S. Employment Report released the first Friday of each month along with the Non-Farm Payrolls.

Average Earnings is an indicator that shows the short-term levels of wages growth in the U.K. It is released monthly with the last three months data and shows the increase in the amount of money an employee receives.

The Athens Stock Exchange General Index is a capitalisation-weighted index which measures the performance of Greek stocks listed on the Athens Stock Exchange. The Index is often called ASE Index. The index has as base value the 100 since December 31, 1980. The contained stocks reviewed on June 15, 2015.

The number of permissions that the government has issued for constructions of new or existing buildings. The Monthly Building Report along with the number of Building permits is kept an eye on by economists and investors since there are many related factors such as employment and financing. The report gives an indication of where the economy is headed in the near future.

This is the value of the inventories held by sellers (wholesalers and retailers) and manufacturers within a country’s borders. High numbers show that the inventory accumulates, which means that the production is more than the demand, and as a result sales growth decreases and economic growth will follow in the same way too.

Indicates the confidence of business managers in their companies/organisations in the near future. A high reading is seen as positive for the country’s economy and its currency.

The Budget Report is released once a year from the British Treasury Chancellor (Chancellor of Exchequer as he is called), and contains details about the economic situation and forecasts, taxation changes, GDP growth estimates, spending and borrowing projections as well as fiscal stimulus.

The BBA (British Bankers Association) releases the monthly index BBA mortgages applications, a measure of how many of the applications for mortgages are approved. This index is a leading indicator since it gives us directions if new homes or home sales are likely to rise or decrease.

Bulls is a term that refers to investors who believe that the market or a specific instrument will rise and as a result they go long on that underlying asset (buying it now to sell it later at a higher price). For example if you are bullish on a currency pair, it means you expect the currency pair to rise.

Bears, the opposite of bulls, refers to investors who believe that the market or a security will decline and as a result they go short on the underlying asset (taking a sell position to sell it later when it will have lower value). They expect to profit from the asset when its value declines.

BoE is the Central Bank of the United Kingdom, with main currency the British pound (GBP). It has its headquarters in London. The governor of the BoE is Mark Carney.

BoJ is Japan’s Central Bank, with main currency the Japanese Yen (JPY). It has its headquarters in Tokyo. Haruhiko Kuroda is the governor of the BoJ.

Bank of Canada (BoC) is Canada’s Central Bank, with main currency the Canadian Dollar (CAD). It has its headquarters in Ontario. The governor of the BOC is Stephen Poloz.

Bank of Russia, or Central Bank of the Russian Federation, is the central bank of Russia, with main currency the Russian ruble (RUB). It has its headquarters in Moscow.

BRICS is an acronym for the economies of Brazil, Russia, India, China and South Africa. The group of the four countries, without South Africa, BRIC was created by Goldman Sachs in 2003 and later, in 2011, South Africa was added and the acronym became BRICS. The idea behind the group was to gather the five countries with the fastest growing economies in the world. The creator of BRICS forecasted that in 2050 these countries will be the five most dominant economies in the world.

On each Wednesday of the second week after each Monetary Policy Committee (MPC) meeting takes place, the full minutes of the meeting, a report with everything discussed by the committee, is published by the BoE.

The Bank of England publishes a quarterly report with many details about the economy’s inflation projections for the next two years with a further economic analysis. Based on this report, the Central Bank decides the interest rates level in order to achieve inflation targets.

Monetary Policy Committee (MPC) is the committee of the Bank of England who meet every month to vote to hike, cut or keep unchanged the official Interest Rates in U.K. It is also responsible for Monetary Policy, Quantitative Easing and any Forward Guidance

The committee consists of nine members including the BoE Governor and is designed to be independent of any political interference.

Blue Chip Stock refers to a stock with high quality, reliability and profitability that represents a financially stable company. The Dow Jones Industrial Average (DJIA) is the most popular index containing U.S. blue chips stocks. Other similar indices are S&P 500 and NASDAQ-100 in the U.S. and FTSE index in the U.K.

Interesting fact: The term derived from poker, in which betting discs includes white, red and blue chips, with blue considered as the most valuable.

BoE Interest Rate is the interest rate determined by the Monetary Policy Committee of the country with a purpose to keep the Inflation Rate to at BOE’s target of 2.0%. If the inflation rate is above the target of 2.0% the Central Bank has the option to increase the interest rates to drag it down and vice versa.

This rate is called the base rate or the repo rate. It is the interest rate the banks use for the overnight lending. For example, the interest rate will pay a commercial bank if it borrows money from the BoE. Going forward, if the central bank increases the interest rate, the other banks tend to increase them too.

Bundesbank, the reserve bank of Germany.

A market characterized by rising prices.

A market in which prices decline sharply against a background of widespread pessimism (opposite of Bull Market).

The Central Bank of Germany.

Brexit is an abbreviation for "British exit," which refers to the June 23, 2016, referendum whereby British citizens voted to exit the European Union.

Consumer Price Index is a statistical estimate that shows the rate that the consumer prices of goods and services are increasing. Economists often refer to it as Inflation Rate and when the rate turns negative they call it deflation. But in fact, there is a slight difference between the inflation rate and CPI: CPI is the overall change in prices while the inflation rate refers to consumer prices, the prices of the households’ purchases. Consumer Price Index is not the perfect tool to gauge inflation rate as it contains many goods whose prices increase due to quality improvements, like computers, cars etc. Most of the countries release their CPI indicator on a monthly basis.

Core CPI is the CPI with some volatile products excluded from the calculations. Usually these products are food and energy. The Core CPI is released along with the CPI. 

The Core PPI is the PPI with some volatile products excluded. Usually, these products are food and energy. Therefore, it measures the average change over time in the prices received by domestic producers of goods and services. PPI measures price change from the perspective of the seller.

Gauges the amount of unemployed people continuing to be unemployed and who apply for unemployment insurance benefits, not for the first time. In the US, the indicator is released every Thursday along with the Initial Jobless Claims.

Construction Spending is the amount of money that is being spent on the construction of new structures or improvements on existing structures in the United States. It is released monthly by the U.S. Census Bureau. The construction spending is a factor of the GDP, so good numbers contribute to a growing GDP.

The CB Leading Index consists of important indicators for the country, calculated by the Conference Board’s analytic system which is responsible to signal peaks and troughs of the business cycle. The index is often just called Leading Index and contains key sector measures such as average weekly manufacturing hours, average weekly initial jobless claims, manufacturers' new orders for consumer goods and nondefense capital goods, building permits and stock prices as well as indices for consumer expectations, M2 Money Supply, the interest rate spread between 10-year Treasury bonds and federal funds. The Index is considered to forecast future economic activity.

It is a percentage that measures how much the production capacity is used. Actually, it is the ratio of the actual output that can be produced to the potential output that could be produced by using fully the installed equipment and utilities. Capacity Utilisation is released by Fed monthly.

It indicates the confidence of consumers for the economy. Therefore, the indicator measures the degree of optimism that consumers feel about the overall state of the economy and their personal financial situation. If the sentiment across the country is low purchases will slow down and the general economy will become dull. Conversely, an increased sentiment means more purchases, raised consumer spending that stimulates the economy.

Goods and Services exports minus imports. It is significant for the country’s economic health. A surplus can be considered as a temporary loan to foreign countries, which means an asset, while a deficit as a loan from other countries, which means a liability.

A percentage shows the amount of unemployed people receiving unemployment benefits over the total number of full-time and part-time employed in the U.K. A high number is considered negative for the country.

A survey which is done by the Bank of England that gauges the inflation that consumers expect in the next year, as a percentage rate. A respective survey exists in Australia and is carried out by the Melbourne Institute.

These currencies are the Canadian Dollar (CAD), Australian Dollar (AUD) and New Zealand Dollar (NZD).

The values of these currencies are strongly related with the export of raw materials such as oil, precious metals and agricultural products.

This is the official currency shared by most of the countries in the Eurozone. The phrase Common Currency is used by the traders as a nickname to refer to the euro.

Currency Name: Euro, EUR
Currency symbol: €
Country:Eurozone (EU)
Commonly called: euro, shared currency, common currency, single currency
Relevant Central Bank: European Central Bank

Traders usually refer to currencies or currency pairs with popular nicknames. Some of them are:

EUR (Euro) - Single currency or Shared currency or Common currency

CHF (Swiss Franc) – Swissy

CAD (Canadian Dollar) – Loonie

AUD (Australian Dollar) – Aussie

NZD (New Zealand Dollar) – Kiwi

EUR/USD (Euro vs U.S. dollar) – Eurodollar, Fiber

EUR/GBP (Euro vs British pound) – Chunnel

USD/JPY (U.S. dollar vs Japanese yen) – dollaryen, Gopher

GBP/USD (British pound vs U.S. dollar) – cable

GBP/JPY (British pound vs Japanese yen) – Guppy

EUR/JPY (Euro vs Japanese yen) – Yuppy

AUD/USD (Australian dollar vs U.S. dollar) – aussiedollar

USD/CHF (U.S. dollar vs Swiss franc) – dollarswissy

USD/CAD (U.S. dollar vs Canadian dollar) – loonie pair

CAC 40 Index is a French Stock market index, a capitalisation-weighted measure of the 40 most significant values among the 100 highest market caps companies traded on the Euronext Paris (known as Paris Bourse). The stocks that are contained are reviewed every quarter. CAC is an acronym for the Paris Bourse’s early automation system ‘Cotation Assistée en Continu’ which means Continuous Assisted Quotation. CAC 40 is often called France 40 as is the benchmark French stock market index. On our platform we represent it as ‘.FRANCECash’.

A government or organization that manages a country's monetary policy. For example, the U.S. central bank is the Federal Reserve, while others include the ECB, BoE and BoJ.

A country's official unit of exchange, issued by its government or central bank, whose value is the basis for trade.

An indicator that gauges the cost of the orders received by manufacturers for durable goods, goods that do not quickly wear out (i.e. cars, bricks, furniture etc.). The orders for these hard goods can determine how busy the factories will be in the future, which is a sign of how the economy is growing. Durable Goods Orders is a closely watched indicator in the United States.

The word is derived from the calm and peaceful bird “dove”. It‘s being used to refer to a calm situation. Usually, in the economic sector, dovish means that the government will decrease or maintain low interest rates.

Deutsche Bundesbank is the Central Bank of Germany, with main currency the euro. It has its headquarters in Frankfurt, Germany.

The Dow Jones Industrial Average (DJIA) is listed on the New York Stock Exchange (NYSE) and the NASDAQ. Often called Dow Jones, Dow 30 or simply Dow, this index is a price-weighted average of 30 large and well-known U.S. companies. Traders often refer to DJIA using the phrase “blue chip index” as it contains 30 blue chip stocks. On our platform, the symbol we use to represent the DJIA is ‘.US30Cash’.

DAX 30 or simply DAX is a German Stock Index with 30 blue chip stocks of major German companies listed on the Frankfurt Stock Exchange. It is based on prices generated in the electronic trading system Xetra. It gauges the performance of Prime Standard’s 30 largest German companies in terms of order book volume and market capitalisation. It is the German index equivalent to the U.K. index FTSE 100 and the U.S. index Dow Jones Industrial Average. On our platform, we represent the DAX 30 as ‘.DE30Cash’.

An indicator released monthly by the National Association of Realtors. It is a gauge for the houses that have been sold in the month, excluding new constructions that instead are counted in the New Home Sales. Existing Home Sales is not the best indicator as it tends to react to mortgage rate changes.

An indicator released by the National Association of Realtors every month, measuring the percentage change of Existing Home Sales from the previous month to the current month. 

The average change (percentage) of the price level of goods that are produced in the U.S. and exported, bought by another country. It is released by the U.S. Department of Labor every month. The Export Price Index as well as the Import Price Index are used to measure the change in prices of the products that are traded globally, i.e. the inflation rate of those products.

Economic Sentiment is a composite indicator in the Eurozone that measures how optimistic or pessimistic people are in different sectors of the economy. Its value is estimated from surveys collected from industries, services, consumers, construction and retail trade, by inquiring about people’s sentiment for the current market conditions and expectations for the future.

Economic Sentiment Indicator consists of: 

Industrial Confidence Indicator 40%

Service Confidence Indicator 30%

Consumer Confidence Indicator 20%

Construction Confidence Indicator 5%

Retail Trade Confidence Indicator 5%

ECB is the Central Bank of Europe, one of the most important central banks with main currency the Euro (EUR). It has its headquarters in Frankfurt, Germany. The president of the ECB is Mario Draghi, former governor of the Bank of Italy.

Emerging Markets refer to markets with characteristics of developed markets but without the standards required to be classified as developed markets. The four largest emerging markets are the BRIC countries (Brazil, Russia, India and China) and South Korea, Indonesia, Turkey and Saudi Arabia are following.

The term emerging market came out from the fact that these markets provide larger profit and greater risk than others.

Euro Stoxx 50 is the Europe’s leading blue chip index in the Eurozone, designed by STOXX. The Index contains 50 stocks from 12 European countries and is often called “Euro 50”. Euro Stoxx 50 is traded on Eurex. On our platform, we represent it as ‘.EURO50Cash’.

The European Central Bank (ECB), usually in the first meeting of each month, announces the Interest Rate Decision of its Government Council, which is taken in order to keep inflation at the target levels.

The Government Council is made up of the ECB president and Vice-President, Governors of the National Central Banks of the eurozone countries, and four other members. Each member votes equally to set the ECB benchmark interest rate, however, the bank does not reveal the detailed votes - just the conclusion.

The Inflation rate target of the bank is below but close to 2.0%. If the Inflation Rate of the Eurozone is substantially below the ECB target, the probable move from Government Council officials is to vote for a rate cut in order to push people to save less and spend more, dragging up the inflation rate. The method works vice versa as well.

The Summary of Commentary on Current Economic Conditions by the Federal Reserve District, commonly known as the Beige Book, is published eight times per year and has 13 sections in total. Released two weeks before each Federal Open Market Committee (FOMC) meeting, it explains the current U.S. economic situation.

Each Federal Reserve Bank gathers information on current economic conditions in its District through reports from Bank and Branch directors and interviews with key business contacts, economists, market experts, and other sources. The Beige Book summarizes this information by District and sector.

It describes the current conditions of each section such as prices, consumer spending, manufacturing, services, real estate, construction, agriculture, labor markets, wages and banking in each one from the 12 Federal Reserve districts (Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas and San Francisco).

The Federal Open Market Committee (FOMC), the Fed monetary policy making body, schedules eight meetings per year. Three weeks after the date of each policy decision the FOMC minutes report is released giving details about the process of the monetary policy decisions and further insights covering the Fed thoughts about the economy.

The volume of orders of durable and non-durable of goods from factories. The indicator is released monthly, 1 - 2 weeks before the Durable Goods Orders. The figure can be very volatile and misleading as it is affected by temporary events that change the demand and the business deals for short-term periods.

A report that is released twice a year by the Bank of England. The report is an overview of the Monetary Committee’s view for stability in the current U.K. financial system and how they ended up with this view. It also includes the strengths and weaknesses of the financial system and all the committee’s decisions, even including which policy actions taken have met the Committee’s objectives.

The Fed is the Central Bank of the United States, with main currency the United States Dollar (USD). It has its headquarters in Washington D.C. The Chairwoman of the Fed is Janet Yellen.

Forward Guidance is a key tool the Central Banks use to signal to the people about the future monetary policy that will apply. They give to the market guidance details about the levels of future interest rates. The benefit of the central bank is to influence the financial decisions of households, businesses and investors. For example, if a central bank indicates that interest rates will remain low, it is likely to encourage people to spend more money. On the other hand, when the central bank signals the rise of interest rates, this discourages people from borrowing or spending money.

FTSE 100 Index is a share index of 100 stocks listed on the London Stock Exchange with high market capitalisation. FTSE is an acronym for Financial Times Stock Exchange. The index is traded on the London Stock Exchange. The FTSE 100 Index is often called FTSE 100, FTSE or U.K. 100 Index and informally traders call it the “Footsie”. On our platform, the symbol we use to represent it is ‘.UK100Cash’.

MIB stands for Milano Italia Borsa and FTSE MIB Index is the benchmark stock market index for the Italian National Stock Exchange, Borsa Italiana. The index is made up from the 40 most traded stocks listed on the Italian National Stock Exchange. The index appears on our platform as ‘.ITALYCash’.

The global currency exchange market. The forex market is the largest, most liquid market in the world with an average daily trading volume exceeding $5.3 trillion. There is no central exchange as it trades over the counter.

The global currency exchange market. The FX (forex) market is the largest, most liquid market in the world with an average daily trading volume exceeding $5.3 trillion. There is no central exchange as it trades over the counter.

Gross domestic product (GDP) is a monetary measure of the market value of all final goods and services produced in a specific time period (quarterly or yearly). The value of all products and services produced by people and companies within country’s borders, GDP indicates the health of a country’s economy and is expressed as a percentage, in comparison to the previous time period. Practically, it indicates whether the current economy is at a recession period or an economic growth; it is a broad measurement of a nation’s overall economic activity. An important change in GDP usually affects the market significantly and estimates are commonly used to determine the economic performance of a whole country or region, and to make international comparisons.

The GDP for the U.S. is released by Bureau of Economic Analysis, Department of Commerce. They release two preliminary figures for each quarterly (GDP Price Index) and yearly (GDP Annualized) release and then come the final figures.

The GDP for the Eurozone is released by Eurostat. They release a preliminary figure s.a. (seasonally adjusted) for each quarter over quarter and year over year indicators and then the final s.a. figures.

The GDP for Germany is released by Statistisches Bundesamt Deutschland. They release only one preliminary figure for each of quarter over quarter and year over year indicators and then the final figures. On a yearly basis, they publish the GDP n.s.a. (non-seasonally adjusted) and GDP w.d.a. (working day adjusted) on a quarterly basis, they publish the GDP s.a. (seasonally adjusted)

The GDP for the U.K. is released by National Statistics. They release two preliminary figures for the quarter over quarter and the year over year indicators and then the final figures.

GDP growth is how much the Gross domestic product (GDP) advances as a percentage i.e. the rate of change of GDP. The GDP growth is by far the most discussed and followed indicator by investors, analysts and policymakers for the well-being of a country. It shows how healthy the economy is and consequently it drives the market significantly on its publication. Most countries release their GDP growth quarterly; firstly they release the preliminary figure and later the final.

The GFK Consumer Confidence is a monthly survey from the GFK group that measures the level of sentiment in households towards economic performance. A high reading is seen as positive for the country’s currency.

The Group 10 currencies are the following:

Eurozone (EUR), United States (USD), United Kingdom (GBP), Japan (JPY), Sweden(SEK), Norway (NOK), Australia (AUD), Canada (CAD), New Zealand(NZD) and Switzerland (CHF).

Greenback is used to refer to the U.S. dollar. It emerged for the name given to the official paper currency issued by the United States during the American Civil War, which was coloured on its back side green. The word “greenback” is an informal term that is still being used by the traders.

Currency Name: United States Dollar USD
Currency symbol: $
Country: United States of America (USA)
Commonly called:Dollar, greenback, buck
Relevant Central Bank: Federal Reserve

A group of the finance ministers and central banks of the seven major wealth economies of the world, according to the Credit Suisse Global Wealth. The group has created in 1975 in order to meet and discuss important economic issues.

These countries are United States, Canada, Japan, Germany, United Kingdom, France and Italy.

A Greek exit from the euro zone, commonly referred to as “Grexit”. 

An indicator of economic strength showing the number of new residential houses that their construction started in a given period. The report, officially called the ‘New Residential Construction Report’ is monitored closely by investors as housing is a key part of the U.S. economy. A high reading means increased demand in the related sectors of real estate, manufacturing, construction and increased mortgages as well as banking services in general. On bottom line means decreased unemployment. The number of Housing Starts is seasonally adjusted as situations like the weather affects it.

HICP indicates inflation and price stability for a basket of goods. It is the Consumer Price Index harmonised accordingly from the European Union member state to signal inflation rate and help the ECB to guide monetary policy.

The word is derived from the predator bird “hawk”. Hawkish refers to more strong and aggressive events. A hawkish tone from the Fed indicates that they are considering tightening monetary policy in the wake of higher expected inflation, a sign of a potential increase in the Fed funds rate.

A name for the Hong Kong Hang Seng Index. The Hang Seng Index is a free-float capitalization-weighted index of a selection of companies from the Stock Exchange of Hong Kong.

Very high and self-sustaining inflation levels. One definition being the period while inflation exceeds 50% until it drops below that level for 12 months. The best-known example of hyperinflation is that of Weimar Germany (after World War I) and Hungary (1946). 

A position or combination of positions that reduces the risk of your primary position. 

The rate that the prices of the goods and services are increasing by which can also be defined as the rate that a currency loses its value. The difference between Consumer Price Index (CPI) and Inflation Rate is that CPI is the overall change in the prices while the Inflation Rate refers to consumer prices, the prices of the households’ purchases. In fact, Inflation Rate can also be considered as the minimum percentage of return an investment must have in order to maintain the standard of living. Consumer Price Index is not the perfect tool to gauge Inflation Rate as it contains many goods whose prices increase due to quality improvements, like computers, cars etc. The Central Banks have different inflation targets, but all of them are trying hard to maintain the inflation rate at the desirable level, making the indicator very important and the market volatile on its release.

The Manufacturing PMI shows the economic health of the manufacturing sector and is released by the Institute for Supply Management (ISM). Manufacturing data are generally released on the first working day of each month. A reading of 50 or higher generally indicates that the industry is expanding while a reading under 50 represents a contraction.

The number of people who are filing for first time to receive unemployment insurance benefits. In the U.S., the indicator is released every Thursday along with the Continuing Jobless Claims. High numbers are considering as a weakness in the country’s labour market.

The average change (percentage) of the price level of goods that are produced in another country and imported to the U.S. It is released by the U.S. Department of Labour every month. If the Import Price Index is very high, inflation rate increases and both Bonds and Equity markets can be hurt. An increased inflation rate may trigger the need of an Interest Rate hike to face it, and this means falling stock prices as companies need larger gains to show profits. In addition, bond prices decrease and the value of the original investment erodes.

Released by the Institute of Economic Research in Germany, this indicator measures the amount of optimistic business leaders for the current situation and business expectations, based on a survey which collects data from manufacturing, construction, wholesale and retail firms. As Germany is the largest country in the European Union, the indicator has an impact on the whole Eurozone and the euro.

This is an indicator that is released by the Institute of Economic Research in Germany and shows the economic current situation and business prospects based on a survey which collects data from manufacturing, construction, wholesale and retail firms. As Germany is the largest country in the European Union, the indicator has an impact on the whole Eurozone and euro.

This indicator, released by the Institute of Economic Research in Germany, shows the economic current situation and business prospects for the short-term future. A high reading is positive for the economy and the euro.

A major indicator showing the strength of the Industrial sector as it measures the change of the production output in the country’s factories and mines. The Industrial sector includes manufacturing, mining and utilities which make up a small part of the GDP (Gross Domestic Product).

A survey by the Eurozone Conference Board that works as a gauge for how optimistic or pessimistic consumers about upcoming months for industrial matters like production expectations, unsold stock and the current backlog of total orders.

A British rate that is released monthly by the National Statistics with the data of the last three months. It is the percentage of the number of people seeking for a job divided by the total labour force. The Unemployment rate is an important gauge of the health of a country’s labour market and is closely followed by economists.

An index released monthly by the Federal Reserve Board that gauges the production output in the country’s factories and mines. The Industrial sector includes manufacturing, mining, electric and gas industries. A high percentage in the IPI shows that the sectors are performing well.

IBEX 35 Index is the benchmark stock market index of Spain’s principal stock exchange, Bolsa de Madrid. It is a weighted index of the 35 most liquid Spanish stocks traded on the Madrid stock Exchange General Index. The stocks contained are reviewed twice a year and the 35 companies with the highest trading volumes for the six previous months are chosen. The IBEX 35 is often called the Spain 35 Index as it is the benchmark Spanish stock market index. On our platform we represent it as ‘.SPAINCash’.

The JOLTS report is created from a survey by the United States Bureau of Labour Statistics every month. JOLTS, the Labour Department’s Job Openings and Labour Turnover Survey, defines the number of open job positions that exist, until the last day of the month. Open positions are vacancies the employers want to fill. The indicator is watched closely as it shows the improvement in the labour market.

A name for the Nikkei 225 index. Nikkei 225 is a price-weighted Japanese stock market index. Its stocks are reviewed once a year. The Nikkei 225 Index is also known as either the Nikkei Stock Average, just Nikkei or Japan 225 Index. It is listed on the Tokyo Stock Exchange (TSE). It is called Nikkei as it is calculated daily by the Nihon Keizai Shimbun (Nikkei) newspaper. On our platform, the index appears as ‘.JAPANCash’.

A slang term for the New Zealand dollar (NZD). It derives its name from New Zealand's national icon - a flightless bird called a kiwi - which is pictured on one side of the country's $1 coin.

This is the number of people who are currently employed or are seeking a job in the U.S. During recessions, the indicator usually decreases as many unemployed are disappointed and stop searching for work.

An index for the overall financial stability of the country which measures the economic performance, and forecasting for future performance, of many sectors such as employment, manufacturing, jobless claims, housing starts, stock prices and yield curve.

The Manufacturing PMI released by Markit Economics - a leading global diversified provider of financial information services - shows the economic health of the manufacturing sector. A reading above 50 represents expansion of the manufacturing sector, compared to the previous month, while a reading under 50 represents a contraction. Markit is a leading global diversified provider of financial information services.

The Services PMI, released by Markit Economics, shows the economic health of the services sector. It captures an overview of the condition of sales and employment. A reading above 50 generally indicates expansion while a reading under 50 shows contraction.

The MBA (Mortgage Bankers’ Association) releases the index MBA mortgages applications, a measure of how many of the applications for mortgages in the U.S. are approved. This index is a leading indicator since it gives us an inclination if the new homes or the home sales are likely to rise or decrease.

The Financial Management Service of the U.S. government keeps records of all the financial activities and releases a positive (surplus) or a negative (deficit) Monthly Budget Statement with details on federal receipts and data based on accounting reports of Federal Entities, disbursing officers and Federal Reserve Bank reports.

The Measure of money supply. Money Supply may affect the inflation rate since monetary expansion adds pressure to the exchange rate.  

M0, M1 Money Supply: Narrow Money, Includes all the amount of money in circulation and values that can be easily converted in cash  

M2 Money Supply: Includes all the amount of money contained in M1, plus short-term time deposits in banks and 24h money market funds  

M3 Money Supply: Includes all the amount of money contained in M2, plus longer-term time deposits and money market funds with more than 24-hour maturity  

M4 Money Supply: Includes all the amount of money contained in M3 plus other deposits

The number of mortgage applications or home loans that are approved by the Bank of England. This index is a leading indicator in the housing sector as it has a direct influence on it.

The economic indicator announcements usually affect the market and any trader can take advantage of this to make a profit. Thus, traders usually look for market consensus, the forecast of what the actual figures will be, to have an idea how to act. Big news agencies carry out a survey, asking many market analysts for their opinions. Market Consensus or Market Forecast is an average of all the collected figures. The market sometimes moves ahead of the final releases, according to the consensus figures, and after the actual values come up the market moves depending on how the actual values were compared to the consensus figures, better or worse.

The Foreign Exchange market is open 24 hours a day, but it is not active all the time which means that there are no investing opportunities during the whole period.

The periods that the market is active are called Market Sessions and depend on the countries’ time zones. The main Market Sessions are the Asian Session (Tokyo), the European Session (London) and the North American Session (New York).

In summer, from April to October, the Asian Session starts at 10:00 pm (GMT) and ends at 8:00 am. The European starts at 7:00 am until 4:00 pm and the American (New York Session) starts at 12.00 pm until 9:00 pm (all in GMT).

In winter, from October to April, all the sessions start an hour earlier.

Objective: Germany
Asset Class: Equity
Geographic Focus: Germany
Symbol: .MDE50_M5

The MDAX is a stock index made up from 50 mid-sized companies’ stocks (midcaps), listed in the Prime Segment of Deutsche Börse. The shares are from various sectors, like pharmaceuticals, chemicals, engineering and financial sectors, excluding technology. MDAX is a performance index, showing the performance of an index portfolio investment, taking into account the income from dividend payments. The Mid Cap 50 index is based on prices generated in the electronic trading system Xetra.

There are two main advantages when trading the MDAX index. With 50 Prime Standards shares, the index offers to the traders a diversified access to the German Mid Cap segment in the most important sectors, excluding the technology sector. Furthermore, the MDAX index is based on a set of straightforward and transparent index rules. The advantage to the investor is that the index is updated on a quarterly basis, which means that the investor only has to adjust the index portfolio on these dates. As a result, this gives them high tradability and cost-efficient index replication.

The Non-Farm Payrolls report is the most watched out for economic indicator in the United States. It includes information about the labour market in government, private sectors, farm and non-farm employees, and includes other estimates on the average weekly hours and earnings. The headline of the NFP report is the Non-Farm Payrolls number which represents the number of jobs gained in the private sector in the U.S. except farm workers, private household employees and non-profit organisation employees. A high NFP number is bullish for the dollar and shows an expansionary economy. The report is released from the Unites States Department of Labour on the first Friday of each month along with the unemployment rate.

New Home Sales is a basic monthly indicator for housing market conditions and represents the amount of sales of newly constructed residences. It is also considered an indicator of demand as new homes need furnishing and thus consuming spending increases. A new home sale is considered to be any deposit or contract signing either in the year the house was built or the year after.

An indicator that measures the percentage change of New Home Sales compared to the last month.

The index is based on a monthly survey from the U.S. National Association of Home Builders (NAHB) about the sentiment for expected home sales and home buildings in the current and next six months period. The index is a widely watched gauge of the outlook for the U.S. housing sector.

The NFIB Research Foundation does quarterly surveys to collect data for Small Business Economic Trends in the U.S. The Business Optimism report is released on the second Tuesday of each month and the Business Optimism Index measures the optimism level of the business managers for their companies.

One month before the official release of the U.K. GDP the National Institute of Economic and Social Research (NIESR) uses statistical projection techniques to make an unofficial Estimate of GDP. It’s a highly respected estimate and tends to move the markets on its release.

Norges Bank is the Central Bank of Norway, with main currency the Norwegian Krone (NOK). It has its headquarters in Oslo.

A weighted index of stocks, containing more than 3,000 common equities. The index is heavily weighted towards information technology companies. The difference between this and other indexes is that not all the contained Companies are headquartered in the U.S. NASDAQ Composite Index is traded on the NASDAQ stock market. On our platform, the symbol we use to represent it is ‘.USTECHCash’.

Nikkei 225 is a price-weighted Japanese stock market index. Its stocks are reviewed once a year. The Nikkei 225 Index is also known as either the Nikkei Stock Average, just Nikkei or Japan 225 Index. It is listed on the Tokyo Stock Exchange (TSE). It is called Nikkei as it is calculated daily by the Nihon Keizai Shimbun (Nikkei) newspaper. On our platform, the index appears as ‘.JAPANCash’.

Overnight Rate, often called Key Interest Rate or Key Policy Rate, is the interest rate that large depository institutions (like banks) use to borrow or lend money to other depository institutions. In most countries, the Overnight Rate level is decided by the Central bank of the country and depends on the bank’s monetary policy since it influences all the other interest rates like consumer loans and mortgages.

The Organisation of the Petroleum Exporting Countries (OPEC) is headquartered in Vienna, Austria. The countries that constitute it are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela.

They organise meetings to discuss their responsibilities which are to coordinate and unify the petroleum policies of these countries and ensure that petroleum supply is done efficiently and economically.

PMI is an index that is derived from surveys and shows the general condition of the economic health in different sectors. The managers in each sector are asked to give a picture of the future of the sector. The Purchasing Managers Index has values from 1 -100. A reading above 50 indicates expansion while a reading below 50 shows contraction. The PMI indicators are usually released monthly, but before the final release there is a preliminary publication.

The change of the consuming price level of consumer goods and services. The index is similar to CPI but it takes into account both households and non-profit organisations that serve households rather than CPI which is calculated only for households. Moreover, the PCEPI uses information for the current and the preceding period for its calculation instead of the current period only as the CPI does. Most of the countries release it quarterly as a percentage.

A weighted index for the change of the producing price level of goods, the wholesale prices (the indicator was called Wholesale Price Index before). It includes prices for wholesale markets, manufacturing industries, commodity markets and any other industries that produce goods. The PPI is released in the second or third week of each month.

The number of existing houses whose selling contracts were signed that month, but the transaction is pending and the process has not closed yet. A high reading shows an increased demand of houses. As housing demand increases, it means that people are earning more money, or feel confident to make mortgage payments.

Personal Income is the money an individual earns from wages or investments like dividends, rents etc. in a certain period. Personal Income affects directly personal spending which is a main part of healthy economic growth. It is usually high in periods of economic expansion and declines during recession.

The money an individual spends for personal use like personal shopping, dining out etc. It is an important indicator for the economy as if liquidity is restricted people reduce unnecessary expenses to save their money for more crucial things. Moreover, it is the largest part of the aggregate economy at the macroeconomic level.

A survey about the business conditions in the manufacturing sector in the Third Federal Reserve district done by Federal Reserve Bank of Philadelphia (Philadelphia Fed). The survey is interrelated with the ISM Manufacturing Index and Industrial Production Index. The survey has been conducted each month since May 1968.

Preliminary release, or Flash, is an estimated figure coming out for an economic indicator, before the final figure. The Preliminary number is determined with only a portion of the total data.

The People's Bank of China (PBoC) is the Central bank of the People's Republic of China, with main currency the Renmindi (RMB) or CNY (ISO 4217). It has its headquarters in Beijing and Shanghai.

Quantitative Easing is a monetary policy that can be used from the Central Bank of a country to boost the economy. Usually, a Central Bank manages the economic situation by raising or decreasing the interest rates. But when the interest rates are near zero, the only way to stimulate the economy is by controlling the quantity of money; thus applying the Quantitative Easing method. The Central Bank buys from the private sector a lot of government bonds or other assets, with cash, in order to increase the cash liquidity.

Quantitative Easing was first used by the Bank of Japan, later by the U.S. Federal Reserve Bank (Q1, Q2, and Q3), the Bank of England and the European Central Bank.

Retail Price Index is a statistical measure that measures the weighted average of consuming prices for a basket of goods and services. It is similar to inflation rate, but includes housing prices which makes it a better indicator for the cost of living than the Inflation Rate.

A weekly indicator of the retail sales growth. It is released every Tuesday by the U.S. Department of Commerce. The month-over-month figures for the first week of the month is calculated by comparing the retail sales of this week with the average retail sales of the whole last month. For the second week, the retail sales for both of the first and the second week of the current month are compared with the average of the whole last month and so on. The year-over-year figures are calculated by comparing the current week with the respective week of the last year.

Retail Sales is a percentage representing the increase in the amount of receipts from all retail stores, which means the increase in sales. It is an important indicator of consumer spending and a large part of the growth of the economy. Most countries release this indicator every month.

A monthly survey done by the University of Michigan collecting information about consumer expectations for the economy overall. The data is collected from telephone surveys. The preliminary MSCI contains about 60% of the collected data and is released before the final report release on the first of month.

The figures that are already published can be replaced later with the revised ones, which means the initially published figures calculated again with more information that was not available before.

RBA is Australia’s Central Bank, with main currency the Australian Dollar (AUD). It has its headquarters in Sydney. The governor of the RBA is Glenn Stevens.

RBNZ is Central Bank of New Zealand, with main currency the New Zealand Dollar (NZD). It has its headquarters in Wellington. The governor of the RBNZ is Graeme Wheeler.

Risk aversion is the behaviour of an investor, who is trying to avoid as much as possible the risk. For example, if a risk averter has to choose between two investments with the same return, they will prefer the investment with the lower risk or will even prefer an investment with a lower return and a lower risk.

In Forex, risk averters are the traders who prefer to invest in safe-haven currencies, currencies which are less volatile because of their large capital markets and their high liquidity (i.e. USD).

Risk appetite is the amount and type of risk a company or an investor is prepared to manage. The investors are willing to invest in higher-yielding and potentially more volatile assets.

In forex, the term risk appetite is used for traders who prefer to invest in currencies with higher interest rates (i.e. AUD, NZD), equities and commodities which are seen as “riskier” assets with a higher possible profit.

The index measures the change in the price level of the residential constructions in the U.S. The official name S&P/Case-Shiller National Home Price Index comes from its creators Karl Chase and Robert Shiller. Data comes from S&P Case-Shiller data and includes both the national index and the indices for 20 metropolitan regions. The indices are tabulated on a monthly basis. They are released on the last Tuesday of each month and are published with a two-month lag time. A high reading indicates a healthy housing market.

The Services Sentiment indicator gauges the business sentiment in the Services sector in Euro Area. The indicator shows the result of a survey containing positive or negative answers for the current and the future situation in the sector. It is a closely watched indicator since the sector of services is a large part of the total GDP, thus it can provide an indication of the health of the economy in general.

The official currency that most of the countries in the Eurozone share. The phrase “Shared Currency” is used by the traders as a nickname to refer to the euro.

Currency Name: Euro, EUR
Currency symbol: €
Country: Eurozone (EU)
Commonly called: euro, shared currency, common currency, single currency
Relevant Central Bank: European Central Bank

The official currency that most of the countries in the Eurozone share. The phrase “Single Currency” is used by the traders as a nickname to refer to euro.

Currency Name: Euro, EUR
Currency symbol: €
Country: Eurozone (EU)
Commonly called: euro, shared currency, common currency, single currency
Relevant Central Bank: European Central Bank

SNB is the Central Bank of Switzerland, with main currency the Swiss franc (CHF). It has its headquarters in Bern and Zurich. The chairman of the SNB is Thomas Jordan.

Sveriges Riksbank is the Central Bank of Sweden, with main currency the Swedish Krona (SEK). It has its headquarters in Stockholm. The governor of the Sveriges Riksbank is Stefan Ingves.

Standard and Poor's 500 Index (S&P 500) is a capitalisation-weighted index of 500 stocks and is often called US 500. The stocks are contained for their market size, their liquidity and their industry grouping. The index is designed to gauge the performance of the wider domestic economy using the changes of the whole market. On our platform, the symbol we use to represent the S&P 500 is ‘.US500Cash’.

The Swiss Market Index is the most liquid Switzerland performance index made up from 20 blue chip stocks. The index is traded on the SIX Swiss Exchange. On our platform we represent the Swiss Market Index as ‘.SWISSCash’.

Another term for the Great British Pound (GBP).

This is the difference between the value of the country’s monthly exports and imports. It’s notable that a trade deficit is not considered as negative for the economy. During a period of recession increased exports are preferred in order to create jobs and demand but during a period of a strong expansion more imports are preferred to provide price competition and restrict inflation.

Turmoil is a non-expected violent movement in the markets that causes a state of confusion or uncertainty. An example of a turmoil is the Ukraine anti-government protesters who tried to oust the President Viktor Yanukovych in both calm and violent ways. The insurrection sharply depreciated the stocks and as expected the indices, not only in Ukraine but in many related countries.

Objective: Technology
Asset Class: Equity
Geographic Focus: Germany
Symbol: .DETEC30_M5

The TecDAX reflects the performance of the 30 largest Technology companies in Germany. The index founded on 24 March 2003, succeeded the NEMAX50 (Neuer Markt — new market) stock index of German new economy companies. The companies existed from 1997 to 2003 and the index was ended after huge losses on the information technology bubble (dot-com bubble). TecDAX is based on prices generated in Xetra and is calculated every trading day.

LTRO is an acronym for Long-Term Refinancing Operation, the process that ECB uses to provide financing to Banks of Eurozone. The main aim of the LTRO is to provide a liquidity cushion to Eurozone banks that hold non liquid assets, with “short-term” low-interest loans (up to 4 years), and to prevent lending between financial organisations which is riskier. The ECB announces periodically the amount of money that will be used for the refinancing operation.

A minimum change in price, up or down.

An effort to forecast future market activity by analyzing market data such as charts, price trends, and volume.

The number of people seeking for a job divided by the total labour force. The Unemployment Rate is an important gauge of the health of a country’s labour market and is closely eyed by the economists.

U.S. Dollar Index is a measure that indicates the value of the dollar in comparison with a basket of six rival foreign currencies. Traders often refer to that index as USDX, DXY even as ICE index since it can be traded on the Intercontinental Exchange. On our platform the symbol we represent the dollar index as ‘.DX_M5’.

Euro (EUR), 57.6% weight
Japanese yen (JPY) 13.6% weight
Pound sterling (GBP), 11.9% weight
Canadian dollar (CAD), 9.1% weight
Swedish krona (SEK), 4.2% weight
Swiss franc (CHF) 3.6% weight

A name for the FTSE 100 index. FTSE 100 Index is a share index of 100 stocks listed on the London Stock Exchange with high market capitalisation. FTSE is an acronym for Financial Times Stock Exchange. The index is traded on the London Stock Exchange. The FTSE 100 Index is often called FTSE 100, FTSE or U.K. 100 Index and informally traders call it the “Footsie”. On our platform, the symbol we use to represent it is ‘.UK100Cash’.

Referring to active markets that often present trade opportunities.

Shows the market's expectation of 30-day volatility. It is constructed using the implied volatilities of a wide range of S&P 500 index options. The VIX is a widely-used measure of market risk and is often referred to as the "investor fear gauge." 

The value of securities traded during a specific period.

The Wholesale Inventories figure is released monthly by the U.S. Census Bureau and measures the change in unsold inventories that is still in the wholesalers’ hands. Analysts look on that figure to see the consumer market performance, since if the Wholesale Inventories increases it means that the consumers’ demand slows down.

West Texas Intermediate, also known as Texas light sweet, is a grade of crude oil used as a benchmark in oil pricing. WTI crude oil is produced, refined and consumed in North America.

A global organization of countries that trade with one another and set rules by which trading is conducted.

Slang for a highly volatile market where a sharp price movement is quickly followed by a sharp reversal.

Symbol for Silver Index. XAG/USD exchange rates for Silver to U.S. Dollar.

Symbol for Gold Index.  XAU/USD exchange rates for Gold to U.S. Dollar. 

Symbol for AMEX Composite Index.

A financial term meaning one billion.Yard is derived from the term "milliard".

The term yield describes the amount in cash (in percentage terms) that returns to the owners of a security, in the form of interest or dividends received from the security. 

Year over year (YOY) is short for year over year, which refers to the mathematical process of comparing one year of data to the previous year of data.

The Yuan is the base unit of currency in China. The Renminbi is the name of the currency in China, where the Yuan is the base unit.

A curve that shows the relationship between yields and maturity dates for a set of similar bonds, usually Treasuries, at a given point in time.

The Centre for European Economic Research in Germany (ZEW - Zentrum für Europäische Wirtschaftsforschung) does a monthly survey, collecting positive and negative responses from the participants for the economic growth in the next six months. The ZEW, based on this survey, calculates three economic indicators for Germany (Economic Sentiment, Current Situation and Expectations) and some of them for other countries, like Economic Sentiment for Eurozone and Expectations for Switzerland.

 Indicates the consumer sentiment about the current economic situation.

A composite indicator which shows the feeling that people have about the economy for the next six months. The index below 50 reflects pessimism, and above 50 optimism.