A commodity market is a market that trades in primary economic sector rather than manufactured products.
Soft commodities are agricultural products such as wheat, coffee, cocoa and sugar.
Hard commodities are mined, such as gold and oil.
Cash commodity or “actual” refer to the physical goods e.g. wheat, corn, soybeans, crude oil, gold, silver, that someone is buying/selling/trading as distinguished from derivatives.
Types of market
Over-the-counter (OTC) market
In an OTC market, dealers act as market makers by quoting prices at which they will buy and sell a security or currency. A trade can be executed between two participants in an OTC market without others being aware of the price at which the transaction was effected.
Exchange traded market
Where a regulated physical body works as an intermediate for buyers and sellers of securities.
It ís the part of a financial system concerned with raising capital by dealing in shares, bonds, and other long-term investments
It ís the market where you purchase securities directly from company rather than other traders or investors
It ís the market place where you purchase securities from other investors not from company itself.
Initial public offering (IPO)
An act of offering the stock of a company on a public stock exchange for the first time
Equity share holder has ownership in the company and has a voting right also. Such a shareholder has to share the profits and also bear the losses incurred by the company.
a share which entitles the holder to a fixed dividend, whose payment takes priority over that of ordinary share dividends.
A sum of money paid regularly (typically annually) by a company to its shareholders out of its profits (or reserves).
A share buyback is a program by which a company buys back its own shares from the marketplace, usually because management thinks the shares are undervalued, reducing the number of outstanding shares.
A stock split is a corporate action that increases the number of the corporation’s outstanding shares by dividing each share, which in turn diminishes its price. The stock’s market capitalization, however, remains the same
Margin is the percentage of your account balance that is required to secure your positions. The more leverage you use, the less of your account balance is required as margin.
A pip is the smallest increment in which a currency pair can move. It is usually the fourth decimal place of the quote currency in a pair. In the case of the Japanese yen (JPY), the pip is the second decimal place of the quote currency.
Pips help traders determine profit or loss, which are calculated according to the number of pips that a currency rises or falls in relation to the price at which it was bought or sold.
The bid price is the price on the left and is lower than the Ask price. It is the price at which you can sell a currency pair.
The ask price is the price on the right, and is also known as the Offer price. It is the price at which you can buy a currency pair
The difference between bid price and ask price is known as spread.
MetaTrader 4, also known as MT4, is an electronic trading platform widely used by online retail foreign exchange speculative traders. It was developed by Meta Quotes Software and released in 2005. The software is licensed to foreign exchange brokers who provide the software to their clients.
Types of orders
Buy stop order
A buy stop order is an order to buy a security which is entered at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.
Sell stop order
A sell stop order in meta trader refers to an pending order to sell a security at a price which is lower than current price.
Buy limit order
It’s a pending order which is put to buy a security at a lower level than current price.
Sell limit order
Itís a pending order which is put to sell a security at higher than current price.