Trading terms glossary
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D

Dark pools
Dark pools is a privately organized financial forum or exchange for trading securities. They allow institutional investors to trade without exposure until after the trade has been executed and reported

Day order
A day order is provision placed on an order to a broker to execute a trade at a specific price that expires at the end of the trading day.

Day trading
Day trading involves buying and selling stocks before the market closure, with the aim of earning short-term profits.

Debt ratio
Debt ratio is an indication of how much debt a company is holding, when compared to the value of its assets. It can also be applied to individuals: in which case it is the cost accrued by their debt compared to total income each year.

Delta
Also termed as hedge ratio, Delta is a measure used in options trading to assess how the price of an options contract changes as the price of the underlying asset moves.

Depreciation
Decline in an asset’s value is defined as Depreciation. It can happen either due to market conditions or other factors like wear and tear. It is the opposite of appreciation.

Derivative
Derivatives are financial products that derive their value from the price of an underlying asset. Derivatives are often used by traders as a device to speculate on the future price movements of an asset, whether that be up or down, without having to buy the asset itself.

Direct market access (DMA)
Direct market access (DMA) is a way of placing trades directly onto the order books of exchanges. As a result, DMA offers traders flexibility and transparency when trading. But due to the risks and complexities involved, it is usually recommended for advanced traders only.

Dividend
A portion of profit that an organization chooses to return to its shareholders in terms of percentage is known as dividend. Dividends are commonly paid quarterly, but in some cases are paid annually, or even monthly, depending on the companies policy.