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IBKR Traders' Glossary

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Margin

In the securities context, margin refers to borrowing money from your broker and using your investment as collateral. In the commodities context, margin refers to the amount of cash a client must put up as collateral to support a futures contract.

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Options

An option contract gives the buyer or holder the right, but not the obligation, to buy or sell an underlying financial asset or commodity. Unlike futures, where the buyer has to fufill the contract, an option gives the choice of whether to exercise or not. In the Market Value - Real FX Position section of the TWS Account Window, this is the real-time mark-to-market value of securities options.

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Macroeconomics

Macroeconomic theory is concerned with the size and output of a national economy, and how the overall economic system behaves as major policy tools, such as interest rates, change. Economists measure the gross domestic product (GDP) of the economy, comprising inputs from individual macro pieces. Employment, consumer and government spending are a couple of the important pieces of the pie that drive growth in GDP.

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Business Cycle

The process of economic activity fluctuating from episodes of growth to episodes of decline. Business cycles have four distinct elements: Recession, Recovery, Peak and Slowdown. Historically business cycles tend to be anywhere from 5 to 10 years peak to peak.

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IBKR ForecastTrader

Interactive Brokers’ unique platform enabling clients to trade event contracts based upon single proposition Yes or No outcomes. The investor faces a question, often based upon the outcome of an event at the end of a specified time period. CME Group launched event contracts on 10 major futures contracts, that offer investors the chance to buy Yes or No outcomes for a single-day event.

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