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Home Categories Trading Skills A buy stop order is an order to buy a security only after the price of the security reaches the specified stop price. Buy to cover refers to a buy order that covers a trader’s short position. Purchasing power is the money an investor has to buy securities. A central counterparty clearing house (CCP) is an organization, usually run by a large bank, that exists in European countries to facilitate the trading of derivatives and equities. The confidence equivalent is the amount of guaranteed money that an investor would accept now instead of risking more money in the future. Clearing is the correct and timely transfer of funds to the seller and securities to the buyer. Closing a position means canceling an existing position in the market by opening an opposite position. A collateralized debt obligation is a complex structured financial product backed by a pool of loans and other assets. A collateralized loan commitment (CLO) is a single security backed by a pool of debt. Correction is a decrease of 10% or more in the price of a security, asset or financial market.