Pips
Pip is the smallest increase of the currency. Pips is an acronym for Percentage in Points or 4 digits behind the comma (colon in nominal U.S.), while Pippette is 5 digits behind the comma (colon in nominal U.S.). Examples are as follows:
* 1.3856 (4 digits behind the dot called the Pips)
* 1.36778 (5 digits behind the dot called Pippette)
Lot
Lot is the standard measure of per transaction, usually 100,000 units of base currency for a standard account, 10,000 units for a mini account and 1,000 units for micro account. The point is that the number of lots is a measure of the size of the transaction on the forex.
Forex broker
Forex broker is a party who can be a company, institution, agency, or individual in which he stood to reconcile between the seller and buyer.
Spread
Spread is the difference between the selling price (bids) and the buy (ask) or quotes buy and sell quotes. Spread is the income earned by the broker at which time we sell, the broker automatically buy and vice versa. So if the trader make a profit, then the broker loss and vice versa. The broker usually gives off a different spread.
Leverage
Leverage allows a trader to use a much larger funds than funds available. For example, leverage, ie 1:1 s / d 1:1000, 1:1000 means a trader with leverage seems to have 1000 times the strength of the deposit that had been deposited, or supposing a loan broker as much as 1000 times the value of deposit that had been deposited by the trader. If the trader deposit $ 1,000, with a 1:1000 leverage means that we seemed to have 1 Million USD, but this leverage also affects the level of margin.
Initial Margin and Margin
Initial Margin is the amount of money to be deposited by a trader for trading purposes. Margin is the amount of deposit required to hold the position in the transaction. For example, a minimum margin of 1% means to maintain a sufficient transaction of $ 100,000 with a capital of $ 1,000.
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