Flat/Square Definition. Flat/Square is dealer jargon used to describe a position that has been completely closed or reversed. For example, if a forex trader bought $200,000, and then sold $200,000 of the same currency, he would thereby create a neutral or “flat” position. One is said to have a flat book in forex if he has no positions or if all long and short positions have been cancelled out. The term “flat” can also apply to trading bonds. In this case, the traded bond does not have accrued interest included in its price, a distinction typically held by bonds in default. Flat money is also a term used to describe a banknote printed by a government as legal tender which is not redeemable and which lacks economic value.
Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.