Base Currency
The Base Currency is the currency against which the other currencies are quoted. One unit of the Base Currency is equal to X units of the secondary currency. (1EUR= Base Currency = 1.3USD Secondary Currency) For example, in the currency pair EUR/USD, the Euro is the base currency. In order to get/buy 1 Euro, the trader will pay the equivalent cost in USD.

Base Rate
The lending rate of the central bank of a given country.

Bear Market
A Bear Market is a market that is distinguished by a long period of declining values.

Bid Rate
The Bid Rate is the number of units of a secondary currency that a market-maker will be required to be pay for the sale of a unit of the base currency. This word is used interchangeably with the term “Selling Rate”. This is the selling price of the base currency.

Bid/Ask Spread
The Bid-Ask Spread, also known as the Bid-Offer Spread, is the quote of the price at which participants in a market are willing to buy or sell a good or security. The Bid will always be smaller than the Ask price.

Broker
An individual or firm that brings buyers and sellers together for a fee or commission. In contrast, a ‘dealer’ commits capital and takes one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party.

Bull Market
A Bull Market is a market which has a long period of rising prices. This is the opposite of the bear market.

Buy Order
A buy order is a specific instruction made by an individual to a broker to buy a security. If a trader expects the market’s price of a security to go up, he would enter the trade with a buy order, and exit the trade with a sell order.