Glossary of Forex (Foreign Exchange) Terminology U – Z
Uptick – It is transaction for a financial instrument that occurs at a higher price than the previous transaction.
Uptick Rule – In the U.S., a regulation only allows a short selling of a stock when it is on an uptick.
US Prime Rate – A commonly used, short-term interest rate at which US banks will lend to their prime corporate customers
Value Date – It is the date when the value of an asset that fluctuates in price is determined. It is the date on which counterparts to a financial transaction agree to settle their respective obligations, i.e., exchanging payments. For spot currency transactions, the value date is generally two business days forward. Also known as maturity date.
Variation Margin – Funds a broker must request from the client to have the required margin deposited. The term usually refers to added funds that must be deposited as a result of unfavorable price movements.
Volatility (Vol) – A measure of price fluctuations. The standard deviation of a price series is commonly used to measure price volatility.
Volume – It is the total number of contracts traded during the day and it represents the total amount of trading activity in a particular stock, commodity or index for that day. In the context of a single stock trading on a stock exchange, the volume is commonly reported as the number of shares that changed hands during a given day.
Weak Dollar/ Strong Dollar – dollar is said to be weak (relative to a previous time period) against another currency when more dollars are required to buy one unit of another currency. The dollar is strong or has gained in strength when fewer dollars are required to buy one unit of another currency. EX) If $1 buys 10 FF in 1989 but today $1 buys only 6 FF then the dollar has weakened against the franc.
Whipsaw – slang for a condition of a highly volatile market where a sharp price movement is quickly followed by a sharp reversal.
Yard – Slang for a billion. Derived from the term “milliard” which is used in some European languages and is equivalent to the number one billion used in American English.
Yield – Return on capital investment.