| Last Trading Day: | The
last day on which trading may occur in a given futures or option. |
| Legging |
This
is the term used to describe a risky method of implementing or closing
out a Spread strategy one side (“leg”) at a time.
Instead of utilizing a “spread order” to insure that both the
written and the purchased options are filled simultaneously, the investor
gambles that a slightly better deal can be obtained on the price of
the Spread by implementing it as two separate orders. |
| Leverage: | |
| Limit Move: | The
largest one-day price move allowed in a future contract, up or down.
During limit up and limit down days, it is impossible for traders to
trade at a price above a limit up move or at a price below a limit down
move. |
| Limit Order: | A
trade order with a specified execution price, e.g., "Buy 100
shares of Microsoft at 147 3/4," or, "Sell 10 June T-bonds
at 118 17/32 limit." Your broker cannot pay more than 147 3/4 for your shares
or sell for less than 118 17/32 for your contracts. A
standard limit order is good for the remainder of the day it is entered
unless you give specific instructions to cancel the order. At the
end of the day, your broker will cancel the order automatically, and
you will have to place it again the next day if necessary. |
| Liquidate: | For
example, to take a second futures or options position opposite to
the initial or opening position. TO sell (or purchase) futures contracts
of the same delivery month purchased (or sold) during an earlier transaction
or make (or take) delivery of the cash commodity represented by the
futures market. Also referred to as Offset. |
| Liquidity: | The
amount of trading activity, and thereby the ease with which you can
get in and out of a market. Measured by volume (and open interest in
the case of futures markets). |
| Local |
A member of an exchange who trades for his own account or fills orders for customers. |
| Long |
Purchasing
an asset with the intention of selling it at some time in the future.
An asset is purchased long given the expectation of an increase
in its price. |
| Low |
The lowest price of the day for a particular contract. |
| Low-level
Pattern |
A
pattern that develops near the bottom of the recent trading range. For
example, a consolidation that occurs at the bottom of a downtrend could
be called a "low-level consolidation." |
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