Traders are a unique bunch of people and in the fast-paced world of the financial markets, traders use slang words to express meaning and save time to maximize profits.
Let’s look at a couple of my top trader expressions...
1# Dead cat bounce
Probably one of the most popular terms, a dead cat bounce is when there is a temporary market recovery after a significant downward trend. The recovery is usually short lived, and the market continues to fall again.
Babysitting is expressed when you are holding a losing position for a long time, hoping the price will turn in your favour so you can get out of the trade at breakeven. #Tip – get rid of your losing trades as soon as possible.
3# Pump and dump
This is the illegal practice of misleading or encouraging investors to run up the price of a stock and as soon as the price is souring the stock is dumped to the determent of the investors.
This is a type of trading strategy that involves high frequency traders taking small quick wins on a continues basis.
This term is expressed when a market or stock takes a sharp term for the worst.
Usually expressed as “my profits didn’t even cover my nut today” Nut referring to the total cost of broker commissions on your trades.
Melting your account refers to a trader taking large losses in a short period of time. The losses are so large that the trader cannot continue to trade as his account has “melted “away.
8# Learning curve
The amount of time it will take a new trader to figure out the mechanics of the trading game before he/ she becomes a profitable trader.
Vultures are usually high-risk investors or traders looking to buy low value or struggling stocks in the hopes of major turnarounds in those companies.
If an instrument you bought runs up a “stick” it refers to a full point (or 1 Rand) or a couple of “sticks” (a couple of Rand) in value.
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