Rally Tops - A price level that concludes a short-term rally in an ongoing trend. A bull market will be made up of a series of rally tops.

Ratio - The relation that one quantity bears to another of the same kind, with respect to magnitude or numerical value.

Reaction - A short-term decline in price.

Realized/Unrealized - The difference between trading revenues that are generated on positions that have been offset and closed, versus those associated with the marking of open positions to current market prices.

Reconciliation - The process of matching outstanding credit/debit entries appearing in statements received from overseas correspondent banks/branches to contra entries posted to the relative Nostro account.

Recourse - The right of a holder of a bill of exchange to demand payment from a person other than the acceptor.

Rectangle - A trading area bounded by horizontal, or near horizontal, lines.

Recursive - A process that is repetitive and usually dependent upon the results of the previous repetition.

Red Clause L/C - A letter of credit provision allowing the beneficiary to draw partial advance payments under the credit.

Relative Return Standard Deviation - Measures the amount of variability of the relative return.

Residual Value - The standard deviation of the unexplained portion of the monthly return.

Resistance Line - On a chart, a line drawn indicating the price level at which rising prices have stopped rising and have moved sideways or reversed direction.

Response - The change in value of the average in response to the impulse.

Resting Order - An order placed with a condition or qualifer but not yet executed.

Return on Assets - The net earnings of a company divided by its assets.

Return on Equity - The net earnings of a company divided by its equity.

Reversal Gap - A chart formation where the low of the last day is completely above the previous day's range with the close above midrange and above the open. 

Reversal Stop - A stop that, when hit, is a signal to reverse the current trading position, i.e., from long to short.

Reverse Exponential Moving Average - An exponential moving average computed working backward through the time series, rather than forward, as is the case with a standard EMA.

Revocable Documentary Credit - As the name implies, the fundamental difference between this type of instrument and an irrevocable credit is that it can be modified or cancelled by the issuing bank (possibly on request from importer/applicant) without consent of the beneficiary.

Revolving Credit - Is one in which, after notice of drawing against it is received by the issuing bank, the balance available for drawing again reverts back or ‘revolves’ to its original amount, providing the credit has not expired in the meantime.

Reward-Risk Rank - Stocks ranked in descending order by reward-risk ratio.

Reward-Risk Ratio - Monthly excess return to risk comparison, calculated by dividing alpha by standard deviation. 

Roll - Substituting a far option for a near option on the same underlying instrument at the same strike price; also to roll forward or roll over.

Roll-Over - The extension of a maturing foreign exchange transaction or the extension of a maturing currency deposit or loan.

Root Mean Square Percentage Error - Square root of the average sum of squared errors experessed as a percentage.

Rotation - Moving funds from one sector to another sector of the stock market as the business cycle unfolds.

Running Market - A market wherein prices are changing rapidly in one direction with very few or no price changes in the opposite direction.

Running Total - Each day's value is added to yesterday's total or subtracted if the value is negative.