Financial Dictionary

Palladium is a precious metal used mainly in catalytic converters for petrol cars. Russia and South Africa are the largest producers, so supply risks there move its price.

Parabolic SAR places dots above or below price to show trend direction and possible stop levels. When the dots flip sides, it signals a possible reversal.

A pending order is an instruction to open a trade automatically when price reaches a set level. Limit and stop entry orders are both pending orders.

A pennant is a small, symmetrical triangle that forms after a sharp move. It is read as a continuation pattern, with a breakout expected in the direction of the earlier move.

Penny stocks are shares of small companies that trade at very low prices. They are often illiquid and highly volatile.

The People's Bank of China is China's central bank. It sets key lending rates and the daily reference rate for the yuan, and its moves affect Asian markets and commodities.

A pin bar is a candle with a long wick and a small body, showing that price was rejected at a level. A long lower wick is read as bullish and a long upper wick as bearish.

A pip is the standard unit of price movement in forex, usually the fourth decimal place, or 0.0001. For pairs quoted against the Japanese yen, a pip is the second decimal place, or 0.01.

A pipette is one tenth of a pip, shown as the fifth decimal place in most currency pairs. Many platforms quote prices to the pipette.

Pivot points are support and resistance levels calculated from the previous period's high, low and close. Day traders use them as reference levels for the session.

Platinum is a precious metal used in jewellery and in catalytic converters for cars. South Africa produces most of the world's supply.

A portfolio is the full collection of positions and assets a trader holds. How it is spread across markets shapes its overall risk.

Position sizing is deciding how large a trade should be, based on account size and how much the trader is willing to risk. A common rule is to risk only a small percentage of the account on each trade.

Position trading means holding trades for weeks or months to capture large trends. Position traders focus on fundamentals and longer timeframes, and leveraged positions build up funding costs over that time.

Pre market trading is buying and selling shares before the main exchange session opens. Volume is thin, so prices can be volatile and spreads wide.

Price action trading reads raw price movement, such as candles, highs and lows, rather than relying mainly on indicators. Traders look for patterns and key levels on a clean chart.

A price gap is a jump in price between one period's close and the next period's open, leaving no trading in between. Gaps often follow news outside market hours and can cause stop losses to fill at worse prices.

The price to book ratio compares a company's share price with its book value per share. A ratio below 1 means the shares trade below the value of the company's net assets.

The price to earnings ratio divides a share price by earnings per share. A high P/E suggests the market expects strong growth, while a low one may signal value or concern.

The Producer Price Index measures changes in the prices that producers receive for their goods and services. Rising producer prices can feed through to consumer inflation.

Profit and loss shows the gain or loss on a trade or account. Realised P&L comes from closed positions, and unrealised P&L from positions still open.

Proof of stake is a way of securing a blockchain where validators lock up coins to earn the right to confirm transactions. It uses far less energy than proof of work.

Proof of work is a way of securing a blockchain where miners compete to solve complex puzzles to add new blocks. Bitcoin uses proof of work.

A pullback is a short move against the main trend before it resumes. Traders often look to enter during pullbacks rather than chasing price.

A purchasing managers' index is a monthly survey of business conditions in manufacturing or services. A reading above 50 signals expansion and below 50 signals contraction.