Forex Glossary (S)

Here are some terms that used in FOREX trading with series of S.   Selling Rate Rate at which a bank is willing to sell foreign currency.

Settlement Actual physical exchange of one currency for another.

Settlement Date It means the business day specified for delivery of the currencies bought and sold under a forex contract.

Short A market position where the client has sold a currency he does not already own. Usually expressed in base currency terms.

SITC Standard International Trade Classification. A system for reporting trade statistics in a common manner.

SOFFEX Swiss Options and Financial Futures Exchange, a fully automated and integrated trading and clearing system.

Soft Market More potential sellers than buyers, which creates an environment where rapid price falls are likely.

Spot (1) The most common foreign exchange transaction. (2) Spot refers to the buying and selling of the currency where the settlement date is two business days forward.

Spot Next The overnight swap from the spot date to the next business day.

Spot Price/Rate The price at which the currency is currently trading in the spot market.

Spread (1) The difference between the bid and ask price of a currency. (2) The difference between the price of two related futures contracts. (3) For options, transactions involving two or more option series on the same underlying currency.

Stable Market An active market which can absorb large sale or purchases of currency without having any major impact on the interest rates.

Stagflation Recession or low growth in conjunction with high inflation rates.

Standard and Poors (S&P) A US firm engaged in assessing the financial health of borrowers. The firm also has generated certain stock indices i.e. S&P 500.

Sterilization Central Bank activity in the domestic money market to reduce the impact on money supply of its intervention activities in the forex market.

Sterling British pound, otherwise known as cable.

Stop Loss Order Order given to ensure that, should a currency weaken by a certain percentage, a short position will be covered even though this involves taking a loss. Realize profit orders are less common.

Stop Out Price US term for the lowest accepted price for Treasury Bills at auction.

Straddle The simultaneous purchase/sale of both call and put options for the same share, exercise/strike price and expiry date.

Strike Price Also called exercise price. The price at which an option holder can buy or sell the underlying instrument.

Strip A combination of two puts and one call.

Structural Unemployment Unemployment levels inherent in an economic structure.

Support Levels A price level at which the buying is expected to take place.

Swap The simultaneous purchase and sale of the same amount of a given currency for two different dates, against the sale and purchase of another. A swap can be a swap against a forward. In essence, swapping is somewhat similar to borrowing one currency and lending another for the same period. However, any rate of return or cost of funds is expressed in the price differential between the two sides of the transaction.

Swift Society for Worldwide Inter-bank Financial Telecommunication is a clearing system for international trading.

Swissy Market slang for Swiss Franc.