S
SAME DAY TRANSACTION
A transaction that matures on the day the transaction takes place.
SELL LIMIT
Specifies the lowest price at which the sale of Base Currency in a Currency Pair can be executed. The limit price in a Sell limit order should be ABOVE the current market Bid price.
SELL STOP
A Sell Stop is a Stop Order that is placed BELOW the current market Bid price and is not activated until the market Bid price is is at or below the stop price. The sell stop order, once triggered, becomes a market order to sell at the current market price.
SETTLEMENT DATE
The date by which an executed order must be settled by the transference of instruments or currencies and funds between buyer and seller.
SHORT
Having an open position that was created by selling a currency. If you sold the EUR/USD, the customer is said to be short the currency pair (sold the base currency). If a customer bought the EUR/USD, he would be long the currency pair, but short USD currency. Foreign exchange transactions assume being long one currency and short another.
SHORT COVERING
Buying to unwind a short position of a particular currency pair (options terminology).
SOPHISTICATED FOREIGN EXCHANGE INVESTOR
Investor possessing sufficient knowledge, experience and/or capitalization to trade in Foreign Exchange market. The investor has to decide for him/herself if Forex is a suitable investment vehicle for his or her purposes.
SOVEREIGN RISK
(1) Risk of default on a sovereign loan; (2) Risk of appropriation of assets held in a foreign country.
SPECULATIVE
Trading Foreign Exchange is speculative in that there is no guarantee that those who invest in Foreign Exchange will make any money. The conditions also exist that the customer can lose his entire deposited margin making trading FX highly speculative. Those who trade foreign exchange should only risk that capital which is considered risk capital, defined as the amount of which if lost would not, change the Customer's lifestyle or the Customer's family's lifestyle.
SPOT
Spot or Spot date refers to the spot transaction value date that is two business days from the deals Trade Date. In instances where there is holiday, weekend or other day when the banks in the countries represented by the currencies in the currency pair are closed, the spot date will be adjusted forward to the next value date where the banks are open. In the case of US Dollar versus the Canadian dollar, the spot date is 1 business day forward from the Trade Date.
SPOT PRICE/RATE
The price at which a currency pair is currently trading in the spot market.
SPOT SETTLEMENT BASIS
The standardized settlement procedure for foreign exchange transactions that sets the value date 2 business days forward from the Trade Date (see: Spot).
SPREAD
The difference between the bid and ask price for a foreign currency price.
SQUARE
The condition whereby the customer's purchases and sales are in balance and there is no open position.
SQUAWK BOX
A speaker connected to a phone often used in broker trading desks.
STERLING
British pound, otherwise known as cable.
STOP LOSS ORDER
A specific order entered by the customer to close out a position if the price moves a certain number of pips in direction opposite from where the market currently is. In most cases Stop Orders are executed as soon as the market reaches or goes through the Customer set Stop Price level. Once issued, the stop order will be held pending until the stop price is reached. Stop orders may be used to close out a position (Stop Loss), to reverse a position, or open a new position. The most common use is to protect an existing position (by limiting losses or protecting unrealized gains). Once the market hits or goes through the stop price, the order is activated (triggered) and FXDD will execute the order at the next available price. Market conditions including volatility and lack of volume may cause a Stop order to be executed at a price different than the order.
STOP PRICE LEVEL
The customer entered price that activates a Stop Loss Order.
SWEEP/SWEEPING
When a customer of FXDD has a P/L in another currency other than US dollars, the P/L must be converting at the close of each business day into US dollars, at an exchange rate prevailing at the time (known as the Conversion Rate). This process is called sweeping. Note that until the P/L is swept, the customer's Account Value may fluctuate slightly (up or down) as exchange rate for the Profit and Loss currency changes. For example, if the customer has a profit in Yen, if the value of the yen rises after the position is closes, but before the profit is swept into dollars, the Account Value will change. The change is only on the profit/loss amount so the effect is minimal.
SWISSY
Market slang for Swiss Franc.