How Forex Signal System Delivers Forex Alerts to you :: Questions

Absolute Rate - The fixed portion of an interest-rate swap, expressed as a percentage rather than as a premium or a discount to a reference rate.

Accreting Principal Swap - A swap whereby the notional value is increasing over time.

Accrual - The apportionment of premiums and discounts on forward exchange transactions that relate directly to deposit swap (Interest Arbitrage) deals, over the period of each deal.

Accumulation/Distribution - A momentum indicator which tries to gauge supply and demand by discovering if investors are generally “Accumulating” (buying) or “Distributing” (Selling) a certain stock by identifying divergences between stock price and volume flow. It is calculated using the following formula: Acc/Dist = ((Close – Low) – (High – Close)) / (High – Low) * Period's volume

Actualize - The underlying assets or instruments which are traded in the cash market.

Adjustable Peg - Term for an exchange rate regime where a country's exchange rate is "pegged" (i.e. fixed) in relation to another currency, often the dollar or French franc, but where the rate may be changed from time to time. This was the basis of the Bretton Woods system.

Adjustment - Official action, normally either by change in the internal economic policies to correct a payment imbalance or in the official currency rate.

Aggressor - A trader dealing on an existing price in the market.

Agent Bank - A bank acting for a foreign bank. In the Euro market - the agent bank is the one appointed by the other banks in the syndicate to handle the administration of the loan.

Aggregate Demand - Total demand for goods and services in the economy. It includes private and public sector demand for goods and services within the country and the demand of consumers and firms in other countries for good and services.

Aggregate Risk - Size of exposure of a bank to a single customer for both spot and forward contracts.

Aggregate Supply - Total supply of goods and services in the economy from domestic sources (including imports) available to meet aggregate demand.

Agio - Difference in the value between currencies. Also used to describe percentage charges for conversion from paper money into cash, or from a weak into a strong currency.

American Currency Quotation - A direct quotation in the foreign exchange markets whereby the value of the American dollar is stated as a per unit measure of a foreign currency.

Appreciation - Describes a currency-strengthening in response to market demand rather than by official action.

Arbitrage - The simultaneous purchase and sale on different markets, of the same or equivalent financial instruments to profit from price or currency differential, the exchange rate differential or swap points. May be derived from Deposit Rate differentials.

Arbitrage Channel - The range of prices within which there will be no possibility to arbitrage between the cash and futures market.

Around - Used in quoting forward "premium / discount." "Five-five around" would mean five points on either side of the present spot value.

Asset - In the context of foreign exchange is the right to receive from a counterparty an amount of currency either in respect of a balance sheet asset (e.g. a loan) or at a specified future date in respect of an unmatched forward or spot deal.

Asset Swap - Similar in structure to a plain vanilla swap, the key difference is the underlying of the swap contract. Rather than regular fixed and floating loan interest rates being swapped, fixed and floating investments are being exchanged.

Asset Allocation - Dividing instrument funds among markets to achieve diversification or maximum return.

Ask Price - The price at which a currency pair or security is offered for sale; the quoted price at which an investor can buy a currency pair. This is also known as the 'offer', 'ask price', and 'ask rate'.

Assignable Contract - A futures contract with a provision permitting the contract holder to convey his or her rights of assignment to a third party.

At Best - An instruction given to a dealer to buy or sell at the best rate that can be obtained.

At or Better - An order to deal at a specific rate or better.

At The Market - An order to buy or sell a futures contract at the best available price upon entrance into the foreign exchange for execution.

Authorized FOREX Dealer - A financial institution or bank authorized to deal in foreign exchange.