Letter S

S — Trading Terms Starting With S

Explore trading terms beginning with S, with clear definitions covering market structure, execution, risk, instruments, analysis, psychology, and performance concepts used by traders.

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Trading terms beginning with S

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S

Scalping

Scalping is a short-term trading style that attempts to profit from small price movements using frequent trades, tight stops, and rapid execution.

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Short Position

A short position is opened when a trader sells an asset expecting its price to fall. Profit occurs when the asset is later bought back at a lower price.

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Short Selling

Short selling is the process of selling a borrowed asset with the intention of repurchasing it later at a lower price. It can involve theoretically unlimited risk if price rises sharply.

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Slippage

Slippage is the difference between the expected execution price and the actual fill price. It often increases during volatility, low liquidity, gaps, and large orders.

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Spread

The spread is the difference between the bid and ask price. It represents an immediate transaction cost and can widen during low liquidity or major news.

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Stop-Loss Order

A stop-loss order is designed to close a position when price reaches a predefined level, limiting planned loss. It does not always guarantee the exact fill price.

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Support

Support is a price area where buying pressure has previously slowed or stopped further decline. It may be formed by prior lows, demand zones, moving averages, or psychological levels.

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Swing Trading

Swing trading involves holding positions for several days or weeks to capture medium-term price movement. It sits between day trading and long-term investing.

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Sharpe Ratio

The Sharpe ratio measures return relative to volatility, usually after subtracting a risk-free rate. A higher value generally indicates stronger risk-adjusted performance.

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