Terms and Definitions

Terms and Definations

This page lists the various terms and definitions used.

REST API

A REST API (which stands for Representational State Transfer Application Programming Interface) is a way for two different software applications to communicate with each other over the internet. It's a type of web-based interface that uses HTTP (Hypertext Transfer Protocol) to send and receive data.

Think of a REST API like a waiter in a restaurant. You (the client) tell the waiter what you want to order (the request), and the waiter goes to the kitchen (the server) to get your food. When the waiter brings your food back to the table (the response), you can eat it and enjoy it.

In the same way, when you use a REST API, you send a request to a server (like the waiter), and the server sends a response back to you with the data you requested (like the food). The request and response are usually in a format called JSON (JavaScript Object Notation), which is easy for computers to read and understand.

So, a REST API is a way for different software applications to talk to each other over the internet, using HTTP to send and receive data in a JSON format.

Charting software

Charting software is a type of computer program that allows you to create graphical representations (or charts) of financial market data, such as stock prices, currency exchange rates, or commodity prices. The charts can help you visualize patterns and trends in the data, which can be useful for making informed trading decisions.

Think of charting software like a graph paper that helps you plot data points and draw lines to connect them. However, charting software is much more advanced than traditional graph paper, as it can display many different types of charts (such as line charts, bar charts, and candlestick charts) and can include various technical indicators (such as moving averages, Bollinger bands, and MACD) to help you analyze the data.

Charting software can be used by traders and investors of all levels of experience, from beginners to professionals. It can be used to analyze historical data or real-time market data, and can often be customized to fit individual preferences and trading strategies. Some charting software is available for free online, while others may require a subscription or purchase.

(Order) Payload

An order payload is a set of data that contains the instructions for buying or selling an asset in a financial market. This data is sent from a trader's charting or custom software to a broker or exchange, typically using a REST API.

An order payload typically includes several pieces of information, such as the asset symbol, the order type (e.g., market or limit), the order quantity, the order price, and any other relevant parameters, such as stop loss or take profit levels. This data is formatted according to the specifications of the broker or exchange API being used, and is typically sent using HTTP POST requests.

When the broker or exchange receives the order payload, it processes the data according to the instructions provided, and executes the trade on behalf of the trader. The order status and other relevant information, such as the fill price and quantity, are then returned to the trader's software for further processing.

Brokers and exchanges

A broker is a person or company that acts as an intermediary between buyers and sellers in financial markets, such as stocks, bonds, or currencies. Brokers help investors buy and sell assets by providing access to the markets and executing trades on their behalf. In exchange for their services, brokers typically charge a commission or a spread (the difference between the buy and sell prices).

An exchange is a marketplace where buyers and sellers can trade assets, such as stocks, bonds, or currencies. Exchanges provide a centralized platform where buyers and sellers can find each other and execute trades. Exchanges are regulated and typically charge fees for their services, such as transaction fees or listing fees.

Both brokers and exchanges provide services that help investors buy and sell assets in financial markets. However, there are some key differences between the two:

1. Role: Brokers act as intermediaries between buyers and sellers, while exchanges provide a marketplace where buyers and sellers can find each other.

2. Execution: Brokers execute trades on behalf of their clients, while exchanges provide a platform for buyers and sellers to execute trades themselves.

3. Fees: Brokers charge commissions or spreads for their services, while exchanges charge fees for transactions or listings.

4. Regulation: Brokers and exchanges are both regulated, but by different organizations. Brokers are typically regulated by financial authorities, while exchanges are regulated by securities and exchange commissions.

Quite often, the terms are used interchangably, even though they are technically different. From the standpoint of Jackrabbit Relay, they both perform the same functionality - process your order request and purchase or sell an asset.

Financial asset

A financial asset is a tradable instrument or investment product that represents a claim to some form of financial value. Financial assets are typically bought and sold in financial markets, such as stock markets, bond markets, currency markets, or commodity markets, with the aim of generating a profit or earning a return on investment.

There are many types of financial assets, each with its own unique characteristics and risks. Some examples of financial assets across various markets include:

1. Stocks: These are ownership shares in a publicly traded company. Stocks can be bought and sold on stock exchanges, and investors can earn returns in the form of dividends or capital gains.

2. Bonds: These are debt securities issued by companies, governments, or other entities. Bonds typically pay fixed or variable interest rates, and investors can earn returns in the form of interest income.

3. Currencies (Forex): These are monetary units used in international trade and finance. Currencies can be bought and sold in currency markets, with the aim of profiting from changes in exchange rates.

4. Commodities: These are physical goods that are traded in commodity markets, such as gold, oil, or agricultural products. Investors can profit from changes in commodity prices by buying and selling commodity futures contracts or exchange-traded funds (ETFs).

5. Derivatives: These are financial contracts that derive their value from an underlying asset, such as a stock, bond, currency, or commodity. Examples of derivatives include options, futures, swaps, and forwards.

Market order

A market order is a type of order used in trading financial assets, such as stocks, bonds, or currencies, that instructs a broker to buy or sell the asset at the current market price. A market order is executed as quickly as possible, typically within seconds or less, and is filled at the best available price at the time the order is placed.

For example, if an investor wants to buy shares of a company using a market order, the broker will execute the order at the current market price, which may be slightly higher or lower than the price when the order was placed. The investor will receive the shares at the market price, regardless of the price at which the shares were trading when the order was placed.

Market orders are typically used when speed of execution is more important than price. They are especially useful for large trades where getting the entire order filled is a priority. However, market orders carry some risks, as the actual price at which the order is filled may differ significantly from the expected price. In fast-moving markets, the price of an asset can change rapidly, and a market order may be filled at a much higher or lower price than expected, resulting in a larger than expected loss or gain.

Limit order

A limit order is a type of order used in trading financial assets, such as stocks, bonds, or currencies, that instructs a broker to buy or sell an asset at a specific price or better. This means that the order will only be executed if the asset reaches the specified price or better.

For example, if an investor wants to buy shares of a company, they can place a limit order to buy those shares at a specific price or lower. If the stock reaches that price or lower, the broker will execute the order. Similarly, if an investor wants to sell shares of a company, they can place a limit order to sell those shares at a specific price or higher. If the stock reaches that price or higher, the broker will execute the order.

Limit orders are useful because they allow investors to control the price at which they buy or sell an asset. They can be particularly helpful in volatile markets, where the price of an asset can fluctuate rapidly, and investors may want to limit their exposure to price changes. However, the downside of limit orders is that they may not be executed if the asset price never reaches the specified price. In this case, the order will remain unfilled until the price reaches the specified level, which may not happen.

API Key

An API key is a unique code or token that identifies a user and grants access to specific data or functionality on an API (Application Programming Interface). Think of it like a password that allows a user to interact with a web-based service or software application.

API keys are typically used by developers to automate tasks or integrate different systems with each other. They can also be used to monitor usage, set rate limits, and enforce security protocols.

For example, if a developer wanted to create an app that pulls data from Twitter's API, they would need to obtain an API key from Twitter first. This API key would authenticate the app's requests to the Twitter API and grant access to the data the app needs.

API keys are typically kept confidential, as they can provide full access to the associated API account. It's important to keep them secure and not share them with anyone who should not have access to the API account.

Secret Key

A secret key, also known as an API secret or API secret key, is a piece of confidential data that is used in combination with an API key to authenticate and secure API requests. Think of it as a special secret code that is only known by the authorized parties involved in an API transaction.

When an API request is made using an API key, the secret key is also used to generate a digital signature that verifies the authenticity of the request. This signature is then compared to a signature stored on the API server to ensure that the request was sent by an authorized user and has not been tampered with in transit.

Secret keys are typically kept confidential and not shared with third parties. They are often used in combination with encryption algorithms to ensure the security of data transmitted over the API.

For example, if you were building an e-commerce site that uses an API to process payments, you would need to obtain a secret key from the payment processor in addition to an API key. The secret key would be used to encrypt and sign requests to the payment processor, ensuring that only authorized parties can access sensitive payment data.

Pair

In the context of trading, a pair refers to a set of two financial assets that are traded together as a single unit. The price of the pair is determined by the exchange rate between the two assets.

Pairs are often used in the foreign exchange market (Forex), where traders buy or sell one currency in exchange for another. In this market, currency pairs are expressed as three-letter codes that represent each currency, with the first currency listed as the base currency and the second currency as the quote currency. For example, the EUR/USD pair represents the exchange rate between the euro (EUR) and the US dollar (USD).

Pairs can also be used in other financial markets, such as the stock market or the cryptocurrency market. For example, in the stock market, traders may pair two stocks from different companies that operate in the same industry, in order to speculate on the relative performance of one stock against the other.

Trading pairs allows investors to speculate on the relative performance of two assets against each other, rather than just the performance of one asset. This can offer greater flexibility and the potential for higher profits, but also carries a higher level of risk due to the added complexity of trading two assets simultaneously.

Symbol

In the context of trading, a symbol is a unique identifier used to represent a specific financial asset, such as a stock, commodity, currency, or cryptocurrency. Each symbol typically has a distinct code that is used to identify it on a trading platform or exchange.

Symbols can vary depending on the market and exchange where the asset is traded. For example, in the stock market, symbols are usually made up of a combination of letters that represent the company name and a unique identifier, such as AAPL for Apple Inc. In the foreign exchange market, symbols are typically expressed as currency pairs, such as EUR/USD for the Euro/US dollar pair.

Symbols are important because they allow traders to quickly and easily identify and trade specific financial assets. They are used to display real-time market data, track performance, and execute trades. When a trader wants to buy or sell a particular asset, they need to enter the correct symbol for that asset into their trading platform or order entry system.

It is important to note that symbols may differ slightly between different trading platforms and exchanges. Traders need to be aware of the specific symbol conventions used by their trading platform or exchange in order to avoid errors when placing trades.

Open-source

Open-source software is software that is released under a license that allows users to study, modify, and distribute the software freely. This means that anyone can access the source code of the software and make changes to it as they see fit.

Community-driven

Community-driven refers to a project or initiative that is led and supported by a group of individuals who share a common interest or goal. In the context of Jackrabbit Relay, the project is driven by a community of developers and traders who are passionate about automated algorithmic trading.

Contributions

Contributions refer to any contributions made by members of the community to the development of Jackrabbit Relay. This can include bug reports, feature requests, code contributions, or financial contributions to support the project's development.

Bug reports

Bug reports are reports that detail issues or errors that have been encountered while using the software. Bug reports are important for identifying and addressing issues in the software to ensure that it runs smoothly and without errors.

Feature requests

Feature requests are suggestions for new features or improvements to existing features in the software. Feature requests help to guide the development of the software and ensure that it meets the needs of its users.

Financial contributions

Financial contributions refer to donations or funding provided to support the development of Jackrabbit Relay. Financial contributions help to ensure the sustainability of the project and allow the developers to devote more time and resources to its development.

Roadmap

The roadmap is a plan or strategy outlining the development goals and milestones for a project. In the context of Jackrabbit Relay, the roadmap outlines the planned features and updates for the software, as well as the timeline for their implementation.