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Topic
Trading
29 guides in Finabase Learn
- After-hours trading Trading in US stocks after the 4:00 p.m. ET close, typically until 8:00 p.m., with thinner liquidity and wider spreads.
- Arbitrage Profiting from a price difference for the same or equivalent asset in two places by buying the cheap one and selling the dear one.
- Ask price The lowest price a seller is currently willing to accept for a security; buyers who want to trade immediately pay the ask.
- Averaging down Buying more of a holding after its price falls, lowering the average cost per share but raising the position's size and risk.
- Bid price The highest price a buyer is currently willing to pay for a security; sellers who want to trade immediately receive the bid.
- Block trade A single large trade, conventionally 10,000 shares or more, usually negotiated privately to limit market impact.
- Commission A fee a broker charges for executing a trade; most US online brokers now charge zero commission on stock trades.
- Dark Pool A private trading venue that does not display orders publicly before execution, used mainly by institutions for large trades.
- Day Order An order that expires automatically at the end of the trading session if it has not been filled; the default at most brokers.
- Day Trading Buying and selling securities within the same trading day, closing all positions before the market closes.
- Earnings Season The weeks after each quarter ends when most public companies report results, peaking roughly three to six weeks into the quarter.
- Earnings Surprise The difference between a company's reported earnings and the consensus estimate, positive for a beat and negative for a miss.
- Extended-hours trading Trading outside the regular 9:30 a.m.–4:00 p.m. ET session, in the premarket and after-hours sessions.
- Fill The execution of an order; a partial fill means only part of the requested quantity traded.
- Limit order An order to buy at or below, or sell at or above, a stated price; it controls price but may not fill.
- Liquidity How quickly and cheaply an asset can be bought or sold without moving its price; deep markets have tight spreads.
- Long position Owning a security in expectation that its price will rise; the opposite of a short position.
- Market order An order to buy or sell immediately at the best available price; it guarantees execution but not the price.
- Mean reversion The tendency of a price or ratio to move back toward its long-run average after an unusual move away from it.
- Paper trading Simulated trading with virtual money and real market prices, used to practice a strategy or learn a platform without risking capital.
- Pattern day trader The FINRA label for a margin customer making 4+ day trades in 5 business days, with a $25,000 minimum; replaced in 2026 with a phase-in to 2027.
- Position size How many shares or contracts a trade uses, usually set so that a loss at the stop costs only a fixed slice of the account.
- Position sizing: how many shares to buy for a set risk How fixed-fractional position sizing turns a risk budget and a stop distance into a share count, with worked examples, ATR-based sizing and the common traps.
- Premarket trading Trading in US stocks before the 9:30 a.m. ET open, from as early as 4:00 a.m. on some venues, with thinner volume and wider spreads.
- Price action The movement of a security’s price over time, and the style of analysis that reads it directly from bars and levels rather than indicators.
- Pullback A short, shallow decline against a prevailing uptrend, which traders often treat as a pause rather than the end of the trend.
- Resistance A price level where rallies have repeatedly stalled because selling pressure has tended to overwhelm buying there.
- Risk-reward ratio The distance from entry to stop compared with the distance from entry to target, used to judge whether a trade is worth taking.
- Short selling Selling borrowed shares in the hope of buying them back later at a lower price, with the profit, the borrow costs and the theoretically unlimited risk explained.
Educational content, not investment advice. Finabase Learn explains how markets and tools work. It does not recommend any security or strategy, and examples are for illustration only. Investing involves risk, including the loss of principal. Rules and figures are for the United States unless stated and can change — check the cited source before you act.