The Prop Trader's Dictionary

From drawdown rules to payout splits — every term you need to understand, master, and pass your challenge.

C

Contract for Difference

A Contract for Difference (CFD) is a financial derivative that allows traders to speculate on the price movement of an asset without owning the underlying asset. Instead of buying or selling the asset itself, traders enter a contract with a broker to exchange the difference in price between the opening and closing of a trade. CFDs are commonly used in markets like forex, indices, commodities, and crypto.

Learn more

Contract Size

Contract size refers to the standardized quantity of an asset represented by a single trading contract. It determines how much of an asset you are controlling in one trade and directly impacts profit, loss, and overall exposure. Contract size varies depending on the market—for example, in forex, a standard lot typically represents 100,000 units of a currency.

Learn more

Candlestick

A candlestick is a type of price chart that displays the open, high, low, and close prices of an asset within a specific time period. Each candlestick consists of a body and wicks, showing both the price range and directional movement during that period. Candlestick patterns are widely used by traders to identify potential market reversals or continuations.

Learn more
Selected glossary section

3+ terms

Explore all glossary terms currently grouped under the letter "C".