R

Trading terms glossary
A – B – C – D – E – F – G – H – I – J – K – L – M – N – O – P – Q – R – S – T – U – V – W – X – Y – Z

–

R

Rally
A rally refers to the price of an asset undergoing sustained upward momentum over a period of time.

Range
Range is the difference between a market’s lowest and highest point over a specified period of time. If a market has a wide range during a given period this is an indication of high volatility, and may be utilized in certain trading strategies.

Rate-of-return
ROR, Rate-of-return, is the profit or loss of an investment over a given period. ROR is expressed as a percentage, with a positive ROR reflecting that an investment has returned a profit, while a negative ROR means a loss.

Ratio spread
Ratio spread options trading strategy where a trader will hold an unequal number of buy and sell positions on a single underlying asset at the same time.

Reserves
Reserves are the liquid assets set aside for future use by a trader. Reserves can be held in the form of commodities, such as gold, but usually traders will keep cash as it is more immediately accessible.

Resistance level
Resistance level is the price at which an assets upward price trajectory is hindered by an overwhelming demand to sell the asset. When an asset appears to be nearing a resistance level, traders may close their position in order to take profit, rather than risk the price falling to a lower price.

Reversal (Trend reversal)
A reversal is a change of direction in the price movement of an asset, e.g. when an upward trend becomes a downward trend, or vice versa.

Rights issue
When a company offers existing shareholders the opportunity to buy additional shares for a discounted price, this is referred to as a Rights issue. The discounted price will usually only be available for a brief period, before returning to the normal price.

Learn more about Rights issues

Risk management
Risk management refers to a variety of processes or strategies, the ultimate goal of which is to identify the potential risk of investments and mitigate potential losses.

Risks
In trading, “risk” refers to any potential event or circumstance in which and investment can lose money.

Regulatory News Service (UK)
The RNS is responsible for disseminating information on behalf of UK publicly listed companies. The RNS operates as part of the London Stock Exchange (LSE) and provides companies with information to help them to meet their regulatory disclosure obligations.

ROCE (Return on capital employed)
ROCE refers to a long-term profitability ratio which measures how effectively capital is used by a company, e.g. profit generated for each each dollar used.

Rollover
A rollover refers to keeping a position open beyond its expiry date.

Relative Strength Index (RSI)
RSI is a tool used in technical analysis to gauge whether an asset is potentially overbought or oversold, and to predict if a rally or correction may be imminent.

Learn more about RSI.