Crypto Glossary

MGC Logic Crypto Golossary will help you understand basic concepts that every trader should know

Crypto

Crypto basically means ontract for difference’. Trading crypto involves scenarios where the traders can speculate on the changes in financial markets that are volatile. They are financial instruments which are derivative and allow traders to have investments in assets without having to own them.

Close

It is basically the end of a given trading period. Close can also be referred to as the exiting of a placed trade.

Expiry

Crypto expiry is the time and date when a derivative contract is said to have expired. Such contracts exist only within specified periods of time.

Gapping

This is a situation that happens when a sudden sharp turn, rise or fall in the price of the crypto occurs and no trading has happened. These abrupt changes are brought about by some external factors like changes in the outlooks of analysts and may be news announcements.

Leverage

This feature allows traders to trade effectively without using their full amounts. It allows traders to optimize their earnings but on the other hand ensuring they do not incur huge losses too.

Limit order

A limit order is the price you will sell at or better.

Long

This is a type of trade available for traders. It is normally initiated by buying.

Pip

A pip is the least price move that an exchange rate can make based on the market convention. Many of the currencies are measured in four decimal places meaning that the smallest change will happen to the last decimal point. This is basically only 1%.

Point                                    

A point is the equivalent of a dollar. If you say that the stock has lost or gain X points then technically you mean that the stock has lost or gained X dollars. You will be talking about the same amount

Short

A short trade is a trade initiated by selling.

Slippage

It is the distinction between an actual price change and what was expected to be the price change. It occurs at any time but it is more evident when there is higher volatility when the market orders are in use.

Spread

Spread is simply the variation between the price at which a particular trader can sell or buy at their asset or commodity.

Stop-loss

Stop-loss is an order issued to a trader to sell at a given point. These orders are put in place to ensure the trader does not incur huge losses and also to keep safe their deposits.

 

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