The Trader’s Dictionary contains explanations of many of the financial terms that successful traders use on a daily basis. This Glossary covers over 200 terms related to the world of finance and trading. Knowing the terms and understanding their meanings will help you learn about trading.
There are currently 32 names in this directory beginning with the letter C.
CAC 40 (fr. Cotation Assistée en Continu) is the main stock index of France and one of the key stock indexes of the entire European Union. The index consists of the 40 largest companies by capitalization, whose shares are traded on the Euronext Paris stock exchange.
Candle is a vertical element of a price chart containing 4 prices for a certain time period. A candlestick consists of a body, which is formed by the opening and closing prices, as well as shadows - upper and lower. The size of the body and shadows is constantly changing. There may be candles without shadows at all or with a very narrow body. The candlestick chart looks like this. Candles are painted green on it, where the trading period ended with growth. Red - with a fall. It is also possible to color in white and black, respectively.
Capitalization - the value of a public company, calculated as the product of the quote of the company's ordinary shares by the total number of ordinary shares in circulation. Capitalization reflects both the real state of the company's affairs and the expectations of investors in the market regarding its future financial success, because investors often purchase shares, calculating the company's development potential.
Carry trading is a type of long-term trading in which profit is earned on the difference in interest rates of the two countries whose currencies are involved in the transaction.
The Central Bank is an organization that is responsible for the formation and implementation of monetary policy, ensuring the functioning of the payment system and monitoring the activities of the financial sector of a country or group of countries. The central bank has the right to issue banknotes of the national currency, thanks to which it regulates the money supply in the economy. The Central Bank is the lender of last resort, that is, it provides commercial banks and other financial institutions with monetary liquidity in emergency situations or in the absence of other creditors.
CFD (Contract for Difference) is a financial instrument that can be traded on price changes. For example, if when buying a share you become the owner of this share (and a shareholder of the company whose security you purchased), then when buying a CFD on a share, you simply buy its “price”, with the possibility of further sale at a higher cost, but the share you don't buy from the company.
China A50 is one of the most respected stock indexes that reflect the dynamics of the Chinese economy. The index is compiled by FTSE Russell and includes the country's 50 largest companies located on the mainland of China.
CME (Chicago Mercantile Exchange) is a Chicago Mercantile Exchange where financial derivatives are traded - futures and options.
Coefficient - the ratio of two quantities or a multiplier for a variable. The calculation of ratios is of great importance in financial markets when analyzing the financial statements of companies. Based on a comparison of coefficients based on data from different companies or securities, an investor can decide to invest in the most attractive of them.
Consolidation is another name for flat. The period when the price does not show trend movements.
Convergence is a mirror image of divergence: the price goes down, but the indicator can no longer, it starts to grow.
Convertibility is a property of an asset that reflects the ease of its convertibility into another asset. For example, a high degree of convertibility of the US dollar into euros indicates the ease of exchanging one currency for another; and the low degree of convertibility of the Nizhny Novgorod apartment for Apple shares indicates the practical impossibility of making such a deal.
Costs - fees for trading in financial markets. These include commissions, spreads, swaps, taxes.
Cross rate is a financial instrument that does not contain the US dollar (USD). However, transactions with cross-rates are still carried out with the participation of the US dollar.
Currency devaluation - a decrease in the real exchange rate of the national currency in relation to other currencies. For example, a change in the USDNOK exchange rate from NOK 9 per US dollar to NOK 12 is a devaluation of the Norwegian krone against the US dollar. Devaluation leads to a relative increase in the cost of imports and an increase in the income of exporters, expressed in national currency.
Currency pair - a financial instrument in which the value of one currency is expressed in units of the second.
Increase in the real exchange rate of the national currency in relation to other currencies. For example, a change in the USDNOK exchange rate from NOK 9 per US dollar to NOK 6 is a revaluation of the Norwegian krone against the US.
Currency revaluation - an increase in the real exchange rate of the national currency in relation to other currencies. For example, a change in the USDNOK exchange rate from NOK 9 per US dollar to NOK 6 is a revaluation of the Norwegian krone against the US dollar. The revaluation leads to a relative reduction in the cost of imports and a decrease in the income of exporters, expressed in national currency.