1

Pip and pips
“Pip” (from the English “pip”) — “point”, “percentage in points”. A measure of the movement of a trading range by which traders can measure profit and loss. 1 point = 0.0001. When discussing their success, traders usually say, “I made 20 pips on this trade” rather than “I made $20 on this trade.”

2

Spreads, tight spreads
This is the difference between the buying and selling price of any asset, measured in points. Spread formula:

Selling price –
Purchase price =

Spread
When we say “narrow spreads”, we mean that this difference is not large. Spreads can be lured depending on prices that are not standing still. A1 Capitals always selects the best spreads for its clients.

3

Trading with leverage
Leverage — credit funds, traders for their transactions can use them to access larger amounts. With a leverage of 100:1, you can trade $100,000 using only $1,000 of your own funds. You should be careful when trading with leverage, as you can either multiply your capital or lose more than you can afford in a couple of seconds.

4

Margin and margin call
To trade in the Forex market, you need a margin. This is the minimum deposit per trade that you can start trading with leverage. Margin formula:

Full lot size /
Leverage size =

Margin
“Margin call” is a notification about insufficient funds to continue conducting open trades.

5

Slippage
Slippage is the difference between your planned target price and the trade execution price. It happens due to market volatility and insufficient execution speed. Its results can be either positive (when you earn more) or negative (when you do not make a full profit, because in a split second the price went against you).

6

Indicators
Economic indicators (indicators) — statistical data on economic activity in the countries of the world. Traders are used to predict the future state of the economy as well as to move the price of assets.

Types of indicators
The indicators differ from each other in terms of target audience, country of origin and impact on financial markets. There are: economic, Asian, American and European indicators, as well as daily, monthly and quarterly.

Keep a few examples of economic indicators:
— Gross domestic product (GDP)
— Unemployment rate
— Consumer price index (inflation rate)
— Building permit
– Currency stability
— Corporate profit
— Interest rates
— Federal funds rate
— Income and salary levels
— Trade balance

These indicators often affect only their own (local) markets. For example, an increase in income levels can lead to inflation, and a decrease in the unemployment rate can lead to better currency stability.