A method of increasing a position size by using unrealized profits from successful trades to increase margin. An investor who is pyramiding uses excess margin from the increasing price of a security in his or her portfolio to purchase more of the same security. This is generally a slow method of increasing one's position size as the margin increases will permit successively smaller purchases.
1. The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing power is important because, all else being equal, inflation decreases the amount of goods or services you'd be able to purchase.2. In investment terms, the dollar amount of credit available to a customer to buy additional securities against the existing marginable securities in the brokerage account. 1. To measure purchasing power, you'd compare against price index such as CPI. A simple way to think about purchasing power is to imagine if you made the same salary as your grandfather. Clearly you could survive on much less a few generations ago, however, because of inflation, you'd need a greater salary just to maintain the same quality of living.2. Each jurisdiction has its own rules governing margin transactions. In the United States you can purchase up to 50% of securities on margin, so, if you had $10,000 in a margin account, you'd be able to purchase up to $20,000 worth of securities. Said another way, you have an extra $10,000 of purchasing power (buying power).
A strategy that aims to limit potential losses to a desired amount by using a stop-loss or stop-limit order. For example, a trader or investor may execute a protective stop by setting a stop-loss order for 10% below what he or she paid for the stock, therefore limiting the loss to 10%.
This ratio refers to a trading system's ability to generate profits over losses. The profit/loss ratio is the average profit on winning trades divided by the average loss on losing trades over a specified time period. This will give a better idea of how well trading systems are performing. The lower the number, the worse the system is at predicting future movements in stock prices. Many books advocate at least a 2:1 ratio. For example, if a system had a winning average of $400 per trade and an average loss over the same time of $240 per trade then your profit/loss ratio would be 5:3 or 1.67:1. The profit/loss ratio can be an overly simplistic way of looking at performance because it fails to take into account an individual's risk tolerance or the probability of gains for each trade.
To execute a trade. The name comes from the printing of the trade on the ticker tape. It is used in the context of general equities.
The phenomenon by which the seller of a particular good, service or security desires to maximize the selling price, while the buyer desires to minimize the purchasing price. Generally speaking, the greater the price tension within a particular market, the greater the bid-ask spread. Price tension tends to decrease liquidity and create price stickiness. If price tension is relatively large within a particular market or exchange, there will be larger bid-ask spreads. Sellers will be asking for more than what the vast majority of buyers are willing to pay, which will drastically reduce the number of exchanges made within the market.Having little liquidity in a given market exposes the investor to liquidity risk, which can result in drastic changes in the security's underlying value.
A speculative market that is based on speculations regarding events, such as who will win an election or whether a sports player will be resigned to a team. All of the "trades" involve a prediction with an unambiguous outcome. Many predictive markets are available to the public, and encompass predictions from who will win an Oscar, to trends in the video gaming industry. A predictive market is structured as a betting exchange, and participants bet (trade) on how they expect an event to unfold.
The primary securities exchange of the Czech Republic. The Prague Stock Exchange is the biggest organizer of the securities market in the Czech Republic, and second largest in central and eastern Europe. This exchange is divided into two types of investors. The big and medium investors trade on the SPAD system and the small investors trade on module auctions. only licensed securities dealers who are members of the exchange are allowed access to its trading system. In 2001 the exchange was an associate member of the Federation of the European Securities Exchanges (FESE), and in May, 2004, the Prague Stock Exchange became a full member of the FESE and was named the "designated offshore securities market" by the U.S. Securities and Exchange Commission, due to its reliability.