Offsetting Transaction
A trade that cancels or offsets some or all of the market risk of an open position.
Related terms
Closed Position
A trade that is no longer active, closed by trading in the opposite direction to the one in which it was opened. Closing a position locks in its final profit or loss.
Read full definitionLiquidation
The closing of an existing position through an offsetting transaction, required when there are insufficient funds, generally when a client’s funds fall below 50% of the required margin.
Read full definitionHedging
Taking an offsetting position to reduce the impact of currency or price movements on a business. The aim is to protect margins and make cash flows more predictable, not to speculate.
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Aggressive
A description of traders and/or price action acting with conviction.
Read full definitionArbitrage
The simultaneous buying and selling of the same currency in different markets to profit from small price differences. The strategy exploits temporary inefficiencies in FX markets.
Read full definitionAt Best
An instruction given to a dealer to buy or sell at the best rate that can be obtained at a specific time.
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An instruction given to a dealer to buy or sell at a specific price or better.
Read full definitionBroker
A third party coordinating the sale of financial securities between sellers and buyers. Exchanges only accept orders from their members, so traders and investors use brokers as intermediaries; brokers are compensated through commissions, fees or payment from the exchange.
Read full definitionBulls
Traders who expect prices to rise and who may be holding long positions.
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