| 1. | Ladder Option | An option that locks in gains as the underlying asset reaches predetermined price levels, In this way, these levels are like rungs of a ladder. The gains are locked in even if the asset More… |
| 2. | Lagging Indicator | Economic indicators that change after the overall economy has changed, used to confirm effects of Fed policy. An example is the Consumer Price Index (CPI). |
| 3. | Leading Indicators | Economic indicators used to predict future economic activity, such as the levels of the S&P 500 index. |
| 4. | Left-Hand Side | Refers to the bid quote, which is the price at which customers who are long a currency pair sell it. |
| 5. | Leverage | The ratio of margin to the maximum position size. With a deposit of $5000 and a leverage of 50, a trader could enter a position with a face value of $250,000. Leveraging allows you to More… |
| 6. | Liability | The obligation to deliver currency as part of a spot transaction. In speculative forex trading, currency is not delivered. All profits and losses are subtracted from margin deposits. |
| 7. | LIBOR | London Interbank Offered Rate - The rate that banks use when borrowing from one another. See also: London Interbank Offered Rate |
| 8. | LIFFE | London International Financial Futures Exchange |
| 9. | Limit Order | An order to transact at a specified price or better. See Buy Limit Order and Sell Limit Order. |
| 10. | Limit Price | The specified price as part of a limit order. |
| 11. | Line Chart | The simplest form of charting, a line chart plots a series of lines connecting the various price levels over a specified time period. |
| 12. | Liquid | Term used to describe a market where there are lots of buyers and sellers generating a great deal of volume. |
| 13. | Liquidation | This is what happens as a result of a margin call. All positions are closed to prevent further loss. At margin call, the value of the account is not sufficient to sustain the position size. More… |
| 14. | Liquidity | Term used to describe a market where there are lots of buyers and sellers generating a great deal of volume. |
| 15. | London Interbank Offered Rate | The London Interbank Offered Rate or LIBOR is a daily reference rate based on the interest rates at which banks borrow unsecured funds from other banks in the London wholesale money market More… |
| 16. | Long | When a currency pair is long, the first currency is bought while the second currency is sold short. To go long on a currency means that you buy it. A long position is expressed in terms of More… |
| 17. | Long Call | An option which gives its holder the right, but not the obligation, to buy the underlying asset. |
| 18. | Long Position | When a currency pair is long, the first currency is bought while the second currency is sold short. To go long on a currency means that you buy it. A long position is expressed in terms of More… |
| 19. | Long Put | An option which gives its holder the right, but not the obligation, to sell the underlying asset. |
| 20. | Lookback Option | An option that lets the holder look back at the prices of the underlying asset during the life of the option and select the ideal price to exercise at. |
