Correlation Correlation describes how closely two instruments move in relation to each other over time.
What it means
Correlation describes how closely two instruments move in relation to each other over time.
Why it matters in live markets
In real markets, conditions like liquidity, volatility, and event risk can change quickly. That can affect quoted prices, spreads, and how orders fill. Understanding this term helps you interpret what you see on the platform and avoid incorrect assumptions when the market is moving fast.
Key points
- Focus on how the term affects price, cost, risk, or execution.
- Relationships can change across market regimes and sessions.
- Use the term to describe what you see, not to assume direction.
Example: A simple way to check your understanding is to apply the definition to a live quote, then ask how it affects cost, risk, or execution.
Related glossary terms
Where you will see it
You will usually encounter this concept in platform quotes, order tickets, trade history, and market commentary. If you are comparing conditions across instruments, check product specifications and note that behaviour can differ by market and session.