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Glossary

Trader

A person that opens trades on the market aiming to get a profit. Anyone can become a trader, all you need is to open at least one trade.

Option

One of derivative financial instruments, i.e. the contract for particular condition fulfillment,
but not for the actual asset purchase.

Currency option

The binary option, which is based on the currency pair. While trading on this instrument, you should forecast the price changing of one currency against the another.

Initial price or Strike price

The price of the chosen asset at the trade opening time (purchase of an option), as it may either increase or decrease during the specified trade time.

Price rise or Call Option

A trader should open a price rise trade, if he or she considers the price to go up. This type of trade is called Call Option. In case you are sure in price increase, then click on the "UP" button.

Trade amount

The amount, which influences the profit amount. In fact, it is the trade price, which can be controlled by a trader. In the case of the correct forecast the trader receives 80% of the trade amount.
The minimum trade amount on OLYMP TRADE is 1$ / 1 €.

Expiration or Option execution

The trade close, i.e. the time of termination of an option after a previously specified time period.

Trade cancellation

This feature gives you a hedging instrument to protect yourself from negative trade result. If you notice that after the trade opening the chart starts moving in the wrong direction, you can easily cancel the trade and avoid large losses.

Deposit

The balance of your trading account, i.e. the amount of funds on your account when you start trading.

Trend

The sustainable price movement on the market for a long period of time. It means steady and noticeable price rising or declining, without taking into consideration slight fluctuations.

Diversification

The risk reduction method while trading options, which involves the purchase of various assets, not interconnected with each other. "Thus you may lose one trade, you can win another one".

Commodity option

Binary option on commodity as a basic asset. Usually it may be oil, precious metal or a food industry product.

Index option

Binary option, which is based on stock indices, such as Dow Jones, RTS, S & P 500, DAX and others.

Trade sessions

The working time of the largest world stock exchanges, grouped by economic regions. There are 4 main trade sessions: Asian, European, Australian, and American.

Broker

An intermediary between large commercial organizations and retail traders on the financial markets. The OLYMP TRADE Company provides its traders with an access to the binary options market.

Binary option

The simplest and the most transparent financial instrument. If the option fulfills the specified conditions within a specified time, it brings a fixed amount of income or does not bring anything.

Point (pips)

The minimum variation value of the currency pair exchange rate. All currency pairs are quoted up to the fourth or fifth decimal point. The exceptions are USDJPY and USDRUB, which are quoted up to third decimal point.

Basic asset

An asset, which you bid to change the price. These assets can be currency pairs or commodities (oil, gold). Beginners usually prefer to start with currency pairs.

Market price

The latest announced price of an asset for the moment.

Price decline or put option

A trader should open a price decline trade, if he or she considers the price to go down. This type of trade is called Put Option. In case you are sure in price decline, then click on the "DOWN" button.

Trade time

The trade expiration time period. If you bought a call-option, then after expiry the asset price should be higher, if you bought a put-option, then the price should be lower.

Option Expiration Rate

The price rate for the selected asset at the time of binary option expiry. This is the result that has to be predicted by a trader. While trading on binary options, the exact price rate is not important, the trader should predict whether it appeared to be higher or lower than the asset price at the time of trade opening.

Profit

This is your profit from a trade. You can see your potential profit and the way it changes in respect to the price rate even before the actual trade is opened. The binary options trading profit is 80%. Thanks to the options, you always know how much you can earn.

Market entry threshold

The minimum required sum on the account that allows a trader to start trading on the market. The minimum balance on OLYMPTRADE is just 10$ / 10€.

Trading hours

The time when one can buy and sell an asset.

Hedging

Insurance. OLYMP TRADE helps you to protect yourself from financial losses by trade cancellation option.

Stock option

Binary option, which is based on shares or securities of the most famous and influential companies.

Volatility

Financial indicator that measures the asset price variability. The higher the volatility, the more rapidly the price of a particular asset changes. That indicates a high interest in the asset. With a low volatility the price remains the same for a long period of time or it may change slightly.