139+ Trading Terms Explained

The ask is the lowest price a seller is currently willing to accept. When you buy with a market order, you pay the ask.

The bid is the highest price a buyer is currently willing to pay. When you sell with a market order, you receive the bid price.

The bid-ask spread is the difference between the highest price buyers will pay and the lowest price sellers will accept — it's an immediate,

A bracket order is a single order entry that simultaneously places three orders: your entry, a profit target above it, and a stop-loss below

A fill is the execution of an order — when your buy or sell order is matched with a counterparty and the transaction is completed, you've re

Level 2 data shows the full order book — all the bids and asks queued at multiple price levels beyond the inside bid and ask — giving trader

A limit order is an instruction to buy or sell a security at a specified price or better — a buy limit will only execute at your price or lo

Margin is borrowed capital from your broker that lets you control a larger position than your cash balance would otherwise allow — a $25,000

A market order is an instruction to buy or sell immediately at the best available price — it guarantees execution but not the price, meaning

Short selling is borrowing shares from a broker and selling them at the current price with the intention of buying them back later at a lowe

Slippage is the difference between the price you expected to receive when placing a trade and the actual fill price you got — it occurs beca

A stop order (also called a stop-market order) becomes a market order and executes immediately at the best available price once the stock to

A stop-limit order combines a stop price (trigger) and a limit price (maximum/minimum acceptable fill) — once the stock hits the stop price,

A stop-loss order is a predetermined exit point placed below a long position (or above a short) that automatically closes the trade if price

Time-in-force (TIF) is an order instruction that tells the broker how long your order should remain active before automatically cancelling —

A trailing stop is a dynamic stop-loss order that automatically moves in your favor as the trade profits — locking in gains incrementally —