These are working definitions for the guides, not a legal dictionary. Where a platform uses a word differently, the client agreement wins, and you should treat our sentence as the thing that needs editing. Send the correction.
How the words sit next to each other
The list below is alphabetical because that is how you find a word at 11pm. The ideas are not alphabetical, and reading them in dictionary order can make leverage sound like a cousin of lot when it is really a cousin of margin. A calmer path, if you have ten minutes and no symbol open, is: bid and ask, then spread, then pip, then lot, then margin and leverage, then stop loss, then swap and rollover. WAT belongs with the session guide. MPR belongs with the naira guide. The rest are the bruises: gap, slippage, drawdown, equity.
Each entry is short on purpose and then a little longer, so the first sentence can be copied into a notebook and the second sentence can stop the usual misunderstanding. If your platform's glossary uses the same word for a different mechanic, their client agreement is the one that will be applied to your money. Tell us anyway. A definition that fights the firms our readers actually use is a definition we should rewrite, not a hill we should defend.
You can filter the list. The box matches the word and the explanation, so typing naira will surface more than USDNGN, and typing gap will find the entries that mention a weekend even if the headword is stop. Nothing you type is stored. When the filter hides a term, the term is still on the page. Clear the box and it comes back.
- Ask
- The higher of the two prices on a ticket, and the price at which you buy. On the teaching EURUSD ticket it is 1.0866. See how a pair works. If you are buying, this is the number that matters at the click, not the nicer one printed beside it. On a phone ticket the ask is often the larger button on the right, filled in the firm's accent colour.
- Base currency
- The first currency in the pair name. In USDNGN the base is the US dollar, and the quote tells you how many naira that dollar is priced at. Lots are counted in the base, which is why a 0.01 lot of EURUSD is about 1,000 euros of exposure, while a 0.01 lot of USDNGN is about 1,000 dollars of exposure. The naira figure you see is the price of that dollar, not the size of the position.
- Bid
- The lower of the two prices, and the price at which you sell. A long position is marked against the bid, which is why the spread shows up as a loss immediately. When you are long, the platform marks you here. That is why a trade can show a loss before the chart has moved in any way you would bother to name. The distance from the ask you paid down to this bid is the spread, paid up front.
- CFD
- A contract for difference. You settle the change in price rather than taking delivery of the underlying currency, share, or ounce. The loss can still be entirely real. You can close it without ever owning the thing the symbol refers to. The firm still expects the difference, and a gap can make that difference larger than the stop you typed. Read the agreement for what happens if the result would push the account below zero.
- Drawdown
- The drop from a peak in the account to a later trough, usually written as money and as a percent. A smooth average can hide an ugly drawdown. Look at the trough. Write it in naira as well as in percent. A 15 percent drop on a large account and a 15 percent drop on a small one are the same shape and a different life. If you only look at the average month, the trough stays invisible until it is the month you are in.
- Equity
- Balance plus the floating result of open positions. Margin calls look at equity, not at the balance you remember from the deposit. A deposit that has not cleared, and a profit that has not been closed, are both easy to spend in your head. Equity is the number the firm is actually using. Refresh it before you size the next idea, especially after a news minute.
- Gap
- A jump in the quote across prices where no trade printed, common over a weekend or through a news second. A stop can fill beyond the line you drew. Weekend gaps are the famous kind. A thin naira quote can gap on a Tuesday afternoon if the book is empty and a headline arrives. Your stop is an instruction, not a promise that someone will deal at that exact price.
- Leverage
- The ratio of position size to the margin set aside. It changes the speed of gains and losses. It does not change the value of a pip. More in the size guide. Two traders can face the same 1:500 offer and hold completely different risk, because one of them sizes from a loss and the other sizes from the maximum the button allows. The ratio did not decide. The volume box did.
- Lot
- A unit of size. On many major pairs a standard lot is 100,000 of the base currency, a mini lot is 0.1 of that, and 0.01 is a micro lot. Check the specification anyway. The word is old and the box is modern, so people type 1.00 because it looks like one unit of something modest. On a major pair that is 100,000 of the base currency. Read the specification before you accept the default the platform left in the field.
- Margin
- The portion of equity locked to keep a position open. It is a deposit with conditions, not a fee you have finished paying. It comes back when the position closes, minus the loss or plus the gain, and minus costs. While the trade is open it is not available for a second idea. Stacking trades until the free margin looks decorative is how one ordinary move becomes a margin call.
- Micro lot
- Usually 0.01 on the volume box, about 1,000 units of the base on a major pair. The smallest step your firm allows is the one the calculator has to respect. If your risk budget is smaller than the loss on this step, the honest volume is zero, not a rounded-up 0.01. Some firms offer a still smaller step. The order of operations does not change: loss first, then the step, then the trade only if it fits.
- MPR
- The monetary policy rate set by the Central Bank of Nigeria. It is a policy fact. It is not, by itself, a 15-minute trade. Traders watch it because interest rates leak into swap and into the story people tell about the naira. The decision itself is a document. Read that, then look at your own ticket, rather than trading the headline that arrived first.
- Negative balance protection
- A contractual promise, where it exists, that you cannot lose more than the money in the account. Read whether your agreement actually contains it. Do not assume a homepage slogan is the clause. Where the clause is real, a violent gap should stop at zero instead of producing a debt. Where it is absent, the same gap can ask you for more money. The difference lives in the agreement, not in the colour of the buy button.
- Pending order
- An instruction to deal later, if the quote reaches a price you named. It can expire, or it can fill in a gap at a worse price. It is not a prediction that the price will visit. It feels safer because nothing happens immediately. The market can still open past your price and fill you where it likes, or it can never visit the price and leave you waiting. Decide the invalidation before you place it, the same as a market order.
- Pip
- The usual step traders count. Often 0.0001 on major pairs and 0.01 on many USDNGN quotes. The extra smaller digit, where it exists, is a pipette. Confirm the step on your ticket before you multiply. Count pips on the symbol you are in, then convert to naira with that symbol's pip cost. Borrowing the euro pip value for a naira chart is a quiet way to be wrong by a large factor. The specification panel is the page that settles the argument.
- Quote currency
- The second currency in the pair name. In GBPUSD it is the dollar. In USDNGN it is the naira, which is why the price is a naira figure. Profit on a pair is naturally born in the quote currency and then translated into the account currency. On USDNGN the quote is already naira, which feels familiar and still depends on the contract size. On EURUSD the quote is dollars, so an account in naira has a second conversion hiding in the profit figure.
- Rollover
- The daily moment a firm rolls a spot position and applies swap. Often near 22:00 or 23:00 WAT, and only certainly at the time that firm prints. Spreads tend to widen around it. If you do not want the swap, be flat before the firm's clock, not merely before midnight in Lagos. The two midnights are often an hour or two apart. The schedule in the platform is the one that charges you.
- Slippage
- The difference between the price you clicked and the price you were filled at. It grows when the book is thin or the news is loud. Size as if a little of it is normal. A calm euro ticket may fill where you clicked. A thin naira ticket, or any ticket during a payroll print, may not. Add a little room in the loss you sized for, or stay out of the minute when the book is rude.
- Spread
- Ask minus bid. It is the toll for entering. On the teaching USDNGN ticket it is 5.20, and it is discussed properly in the naira guide. Compare it with the move you think you need, in the same units, before you admire the pattern. A setup with a beautiful story and a spread larger than the target is a cost with a drawing attached. Rewrite the target or leave the trade.
- Stop loss
- An order intended to close a position if the price reaches a level that proves the idea wrong. It limits damage in ordinary conditions. It does not repeal gaps. Place it where the idea is wrong, then size the trade so that distance is affordable. Moving it further away after entry, without reducing size, is a new and larger risk wearing the old trade's name.
- Swap
- Overnight financing on a leveraged position, which can be charged or credited. It is not income. On a wide pair it can dwarf the move you were waiting for. Check the sign. One direction can pay you a small amount and the other can charge you more than the day's range on a wide pair. Holding through the roll because a chat said the swap was income is how a flat chart still loses money.
- Take profit
- An order intended to close a winner at a price you set in advance. Useful for leaving the screen. Useless as a personality. It is a plan for being absent, which is useful, and a temptation to pick a number that looks round. The round number still has to clear the spread and the costs or it is a wish. If you cancel it to let a winner run, write down the new invalidation or you are back to hoping.
- WAT
- West Africa Time, UTC+1, with no daylight saving in Nigeria. The session guide converts London and New York into it. Put the month beside any foreign time you copy into a notebook. A London open that was 08:00 in October is 09:00 after the UK clock change, and New York slips again a week later. The session guide keeps both versions so the page does not pretend the year has one afternoon.