When I started in Positive there was a lot of terminology that I needed to get the hang of very quickly.
Otherwise you may think that there’s a bad viral bug going around the office as you will constantly hear about people “puking”, and you may then determine that this is caused by the vast number of “ticks” which roam the office or the big friendly guy in the office who is apparently “squeezing everybody”. So, in order to prevent some of the confusion I went through, below is a list of some of the most used terms in the office.
Not quite as horrible as the medieval practice of removing the scalp from someone’s head, this is a speculator who buys and sells rapidly, with small profits or losses, holding his positions for only a short time during a trading session. Typically, a scalper will be ready to buy at a fraction below the last transaction price and to sell at a fraction above.
Going Long or Short:
No, no, we don’t throw a ball around the office all day. Going Long, is the practice of buying a futures contract with the intention of selling it again at a higher price. Going short is the practice of selling a futures contract that you do not currently own, with the intention of repurchasing the contract at a lower price.
No, this does not refer to getting up from your desk and running to the nearest bathroom…. although it might happen one day. This refers to getting out of a bad position.
Unfortunately it is not a big hug that someone in the office will give you if you’re having a bad day. This is when a position goes against you just that bit too much so you have to take a loser, even though you are still confident that the trade is good.
This is not the little bloodsucker that embeds itself in your skin. However, if you lose enough “ticks” the pain may be similar! It is the minimum upward or downward movement in the price of a security, this is a term you will hear a lot!
This refers to the easier and more predictable trades. This term really boils my blood. There is nothing ‘free’ about working 14 hour days for a trade, no matter how certain it is. The very fact that you are sitting in an office trading and not doing some other job means there is serious opportunity cost to trading the “free money” trade. It takes hard work to take money from the market, and the harder you work the more money you take. So if you’re looking for “free money” in this profession forget about it! Well it is free money alright, you just have to work really hard for it…