Angie / Learn Every word behind the number Swipe the deck. Tap a card to turn it over. Jump to a letter.
All Valuation Statements Strategy Markets
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 Markets 01 / 151 Accredited investor Someone meeting income or net-worth thresholds, which unlocks private offerings. The rule assumes wealth implies sophistication, which is a rough proxy. Tap to flip ↻ ↻ Back 01 / 151
Accredited investor A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 02 / 151 ADR American depositary receipt A receipt representing shares of a foreign company, traded in dollars on a US exchange. You own the economics without holding the foreign shares. Tap to flip ↻ ↻ Back 02 / 151
ADR A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 03 / 151 ADX Average directional index Measures how strong a trend is without saying which way it points. Low readings mean a market going sideways, where trend-following strategies bleed. Tap to flip ↻ ↻ Back 03 / 151
ADX A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 04 / 151 ATR Average true range The typical distance a price travels in a day. Used to size stops in the stock's own terms, so a volatile name gets more room than a quiet one. Tap to flip ↻ ↻ Back 04 / 151
ATR A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 05 / 151 Backtest Running a set of rules over history to see what they would have done. It shows what did happen, never what will, and it flatters any rule tuned on the same data. Tap to flip ↻ ↻ Back 05 / 151
Backtest A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 06 / 151 Beta How much the stock moves relative to the S&P 500. A beta of 1.0 moves with the market, higher is more volatile, and higher volatility raises the discount rate. Tap to flip ↻ ↻ Back 06 / 151
Beta A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 07 / 151 Bid-ask spread The gap between the highest price a buyer will pay and the lowest a seller will accept. It is the cost of trading, and you pay half of it on the way in and half on the way out. Tap to flip ↻ ↻ Back 07 / 151
Bid-ask spread A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 08 / 151 Block trade Block / Big print A single trade far larger than the tape's usual print, typically an institution moving size. The paper desk marks any print five times the running median. Tap to flip ↻ ↻ Back 08 / 151
Block trade A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 09 / 151 Bollinger bands A moving average with bands drawn two standard deviations above and below it. Price at a band is unusual relative to its own recent range, not relative to any other stock. Tap to flip ↻ ↻ Back 09 / 151
Bollinger bands A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 10 / 151 Bond Fixed income / Debt security A loan to a company or government, repaid on a fixed schedule with interest. You are a creditor, not an owner, and you get paid before shareholders. Tap to flip ↻ ↻ Back 10 / 151
Bond A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 11 / 151 Business cycle The repeating pattern of expansion, peak, contraction and trough. It is why a cyclical company's best year is a poor guide to its future. Tap to flip ↻ ↻ Back 11 / 151
Business cycle A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 12 / 151 Buy and hold B&H / Benchmark Buying once and doing nothing. The benchmark every strategy must beat, measured over the identical window, because beating nothing is not a result. Tap to flip ↻ ↻ Back 12 / 151
Buy and hold A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 13 / 151 Buyback Share repurchase A company buying its own shares, which raises earnings per share by shrinking the denominator. Value-creating below intrinsic value and value-destroying above it. Tap to flip ↻ ↻ Back 13 / 151
Buyback A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 14 / 151 CAGR Compound annual growth rate / Annualized return Total return restated as a steady yearly rate, which makes runs of different lengths comparable. Tap to flip ↻ ↻ Back 14 / 151
CAGR A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 15 / 151 Call option The right to buy at the strike price. It gains value as the underlying rises, and it expires worthless if the underlying never gets there. Tap to flip ↻ ↻ Back 15 / 151
Call option A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 16 / 151 Calmar ratio = return ÷ maximum drawdown Return measured against the worst loss along the way, rather than against general choppiness. It punishes the single deepest hole. Tap to flip ↻ ↻ Back 16 / 151
Calmar ratio How it is calculated
Calmar ratio = return ÷ maximum drawdown
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Statements 17 / 151 Capex Capital expenditure Spending on property and equipment. Reported as a negative number and shown here as the amount subtracted from operating cash flow. Tap to flip ↻ ↻ Back 17 / 151
Capex A fuller explanation of this one is still being written. The definition above is the short answer.
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Statements 18 / 151 Cash Cash and equivalents / Short-term investments Cash, equivalents and short-term investments. Netted against debt to bridge the value of the business to the value of the shares. Tap to flip ↻ ↻ Back 18 / 151
Cash A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 19 / 151 Cash-secured put Selling a put with the cash set aside to buy the shares if assigned. You are paid to agree to buy at a price you were happy with anyway. Tap to flip ↻ ↻ Back 19 / 151
Cash-secured put A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 20 / 151 Classification Profile / Lifecycle stage The company's sector, which sets the growth ceiling and terminal method, combined with its lifecycle stage read from its own cash-flow history. Re-derived every run, and you can override it. Tap to flip ↻ ↻ Back 20 / 151
Classification A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 21 / 151 Closed-end fund A fund with a fixed share count that trades on an exchange. Its price can sit above or below the value of what it holds, sometimes for years. Tap to flip ↻ ↻ Back 21 / 151
Closed-end fund A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 22 / 151 Convertible A bond or preferred share that can be exchanged for common stock. It pays like debt until the equity is worth more, then behaves like equity. Tap to flip ↻ ↻ Back 22 / 151
Convertible A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 23 / 151 Correlation How closely two things move together, from −1 to +1. Diversification depends on it, and it has an unhelpful habit of rising toward 1 in a crisis. Tap to flip ↻ ↻ Back 23 / 151
Correlation A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 24 / 151 Cost of debt = interest expense ÷ debt The implied interest rate the company actually pays. Applied after the tax shield in the WACC, because interest is tax-deductible and equity dividends are not. Tap to flip ↻ ↻ Back 24 / 151
Cost of debt How it is calculated
Cost of debt = interest expense ÷ debt
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Valuation 25 / 151 Cost of equity CAPM / Capital asset pricing model = risk-free rate + beta × equity risk premium The return shareholders demand for owning this particular company. Known as CAPM, the capital asset pricing model. Tap to flip ↻ ↻ Back 25 / 151
Cost of equity How it is calculated
Cost of equity = risk-free rate + beta × equity risk premium
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Markets 26 / 151 Coupon rate The fixed annual interest a bond pays, as a percentage of its face value. It never changes, which is why the price has to move instead. Tap to flip ↻ ↻ Back 26 / 151
Coupon rate A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 27 / 151 Covered call Selling a call against stock you already own. You collect the premium and give up everything above the strike, which is a real trade, not free income. Tap to flip ↻ ↻ Back 27 / 151
Covered call A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 28 / 151 Credit rating An agency's opinion on how likely a borrower is to repay. Investment grade above BBB−, high yield below it, and the agencies are paid by the issuer. Tap to flip ↻ ↻ Back 28 / 151
Credit rating A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 29 / 151 Currency risk The risk that exchange rates move against you on a foreign holding. A foreign stock can rise in its own currency and still lose you money. Tap to flip ↻ ↻ Back 29 / 151
Currency risk A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 30 / 151 Curve fitting Overfitting Tuning a strategy until it memorises one stretch of history. It produces beautiful backtests and no future returns, which is why results are held out and re-tested. Tap to flip ↻ ↻ Back 30 / 151
Curve fitting A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 31 / 151 DCF base Normalized FCF / Normalised free cash flow The figure the projection actually starts from: a trend-fitted or median value across several years, so one distorted year cannot become a runaway base. It can sit far from the latest year. Tap to flip ↻ ↻ Back 31 / 151
DCF base A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 32 / 151 Delta How much an option's price moves for a one-dollar move in the underlying. It doubles as a rough probability of finishing in the money. Tap to flip ↻ ↻ Back 32 / 151
Delta A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 33 / 151 Discount factor = 1 ÷ (1 + WACC)^t How much a dollar arriving in year t is worth today, adjusted to mid-year because cash arrives through the year rather than all on 31 December. Tap to flip ↻ ↻ Back 33 / 151
Discount factor How it is calculated
Discount factor = 1 ÷ (1 + WACC)^t
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Valuation 34 / 151 Discounted cash flow DCF Valuing a company by projecting the cash it will generate and discounting each year back to today. Everything Angie does is one long DCF. Tap to flip ↻ ↻ Back 34 / 151
Discounted cash flow A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 35 / 151 Diversification Holding enough uncorrelated positions that no single one can ruin you. It removes company-specific risk and cannot touch market risk. Tap to flip ↻ ↻ Back 35 / 151
Diversification A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 36 / 151 Dividend Cash paid out to shareholders. It is a decision about what to do with free cash flow, not a measure of how much of it there is. Tap to flip ↻ ↻ Back 36 / 151
Dividend A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 37 / 151 Duration How much a bond's price moves for a one-point change in rates. A duration of 7 means roughly a 7 percent fall if yields rise a point. Tap to flip ↻ ↻ Back 37 / 151
Duration A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 38 / 151 Earnings yield = 1 ÷ trailing P/E Earnings for every dollar invested, which makes a stock directly comparable to a bond yield. A company losing money has none. Tap to flip ↻ ↻ Back 38 / 151
Earnings yield How it is calculated
Earnings yield = 1 ÷ trailing P/E
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Strategy 39 / 151 EMA Exponential moving average An average of recent prices that weights the latest days most heavily, so it turns faster than a simple average. A fast one crossing above a slow one is the classic trend signal. Tap to flip ↻ ↻ Back 39 / 151
EMA A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 40 / 151 Enterprise value EV = sum of PV + PV of terminal value The value of the whole operating business, before asking who has a claim on it. Debt holders are paid before shareholders, so this is not yet what the shares are worth. Tap to flip ↻ ↻ Back 40 / 151
Enterprise value How it is calculated
Enterprise value = sum of PV + PV of terminal value
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Statements 41 / 151 EPS Earnings per share Profit for the last twelve months divided by the share count. Accounting profit, not cash, which is why Angie values the cash instead. Tap to flip ↻ ↻ Back 41 / 151
EPS A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 42 / 151 Equity risk premium ERP = market return − risk-free rate The extra return investors demand for holding stocks instead of Treasuries. Beta scales it up or down for one particular company. Tap to flip ↻ ↻ Back 42 / 151
Equity risk premium How it is calculated
Equity risk premium = market return − risk-free rate
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Valuation 43 / 151 Equity value = enterprise value − net debt What is left for shareholders once the lenders have been paid. Tap to flip ↻ ↻ Back 43 / 151
Equity value How it is calculated
Equity value = enterprise value − net debt
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Markets 44 / 151 ETF Exchange-traded fund A basket of securities that trades on an exchange like a single stock. Most track an index, charge very little, and can be bought and sold all day. Tap to flip ↻ ↻ Back 44 / 151
ETF A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 45 / 151 Evolutionary search Genetic algorithm Seeding a population of settings, keeping the strongest, then mutating and recombining them over generations to home in on what works. Tap to flip ↻ ↻ Back 45 / 151
Evolutionary search A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 46 / 151 Ex-dividend date The first day a buyer no longer receives the coming dividend. The price typically drops by roughly the dividend that morning, which is arithmetic rather than a sell-off. Tap to flip ↻ ↻ Back 46 / 151
Ex-dividend date A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 47 / 151 Exit FCF multiple The multiple applied to terminal-year free cash flow when the exit-multiple method is used instead of Gordon growth. Tap to flip ↻ ↻ Back 47 / 151
Exit FCF multiple A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 48 / 151 Expense ratio The annual percentage a fund charges. It comes out whether the fund gains or loses, and over decades it compounds against you exactly as returns compound for you. Tap to flip ↻ ↻ Back 48 / 151
Expense ratio A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 49 / 151 FCF margin Free cash flow margin = free cash flow ÷ revenue How many cents of spendable cash each dollar of sales leaves behind. Tap to flip ↻ ↻ Back 49 / 151
FCF margin How it is calculated
FCF margin = free cash flow ÷ revenue
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Markets 50 / 151 Fed funds rate The overnight rate banks charge each other, targeted by the Federal Reserve. It is the short end of the curve every other rate is priced from. Tap to flip ↻ ↻ Back 50 / 151
Fed funds rate A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 51 / 151 FINRA The self-regulatory body overseeing broker-dealers and their representatives, operating under SEC authority. It licenses the people who handle your orders. Tap to flip ↻ ↻ Back 51 / 151
FINRA A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 52 / 151 Fiscal policy Government taxing and spending, as distinct from what the central bank does. It moves demand directly rather than through the price of credit. Tap to flip ↻ ↻ Back 52 / 151
Fiscal policy A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 53 / 151 Forward P/E = price ÷ expected next-year EPS The same ratio against next year's expected earnings, so it depends on a forecast rather than a fact. Tap to flip ↻ ↻ Back 53 / 151
Forward P/E How it is calculated
Forward P/E = price ÷ expected next-year EPS
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Valuation 54 / 151 Free cash flow FCF = operating cash flow − capex The cash left for investors after keeping the business running. This is the number a DCF actually values, taken from the most recent fiscal year. Tap to flip ↻ ↻ Back 54 / 151
Free cash flow How it is calculated
Free cash flow = operating cash flow − capex
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Markets 55 / 151 Gamma and theta Gamma is how fast delta changes; theta is how much value the option loses per day. Together they are why an option buyer is racing a clock. Tap to flip ↻ ↻ Back 55 / 151
Gamma and theta A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 56 / 151 GDP Gross domestic product Everything produced inside a country's borders. Its long-run growth rate is the ceiling on what any company can sustainably grow at forever. Tap to flip ↻ ↻ Back 56 / 151
GDP A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 57 / 151 Good-til-canceled GTC An order that stays live across sessions until it fills or you cancel it, as opposed to a day order that expires at the close. Tap to flip ↻ ↻ Back 57 / 151
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Strategy 58 / 151 Grid search Testing every combination of the settings you chose. Exhaustive and certain, and the count explodes as soon as you add a third or fourth knob. Tap to flip ↻ ↻ Back 58 / 151
Grid search A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 59 / 151 Growth rate Year-one growth, faded toward the perpetual rate across the horizon. Left blank it comes from the company's own history, capped at the sector ceiling, and a genuine decline is kept rather than floored up. Tap to flip ↻ ↻ Back 59 / 151
Growth rate A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 60 / 151 Hedge fund A private pooled fund open only to qualifying investors, with wide freedom over what it trades, high fees, and limited ability to withdraw. Tap to flip ↻ ↻ Back 60 / 151
Hedge fund A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 61 / 151 Horizon Projection period How many years are projected explicitly before the terminal value takes over. Longer horizons matter only when growth genuinely exceeds the perpetual rate. Tap to flip ↻ ↻ Back 61 / 151
Horizon A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 62 / 151 Implied volatility IV (options) How much movement the option's price implies the market expects. It is not a forecast anyone made, it is what falls out of the price when you solve backwards. Tap to flip ↻ ↻ Back 62 / 151
Implied volatility A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 63 / 151 Index fund Passive fund A fund that buys everything in an index rather than trying to pick winners. It is the default against which any active strategy has to justify itself. Tap to flip ↻ ↻ Back 63 / 151
Index fund A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 64 / 151 Inflation The rate at which money loses purchasing power. It raises interest rates, which raises discount rates, which lowers every valuation at once. Tap to flip ↻ ↻ Back 64 / 151
Inflation A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 65 / 151 Insider trading Trading on material information the public does not have yet. Illegal, and the reason company insiders must file their trades publicly. Tap to flip ↻ ↻ Back 65 / 151
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Markets 66 / 151 Intrinsic and time value = premium = intrinsic value + time value Intrinsic value is what the option would be worth exercised right now. Everything else in the price is time value, and it decays to zero at expiry. Tap to flip ↻ ↻ Back 66 / 151
Intrinsic and time value How it is calculated
Intrinsic and time value = premium = intrinsic value + time value
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Valuation 67 / 151 Intrinsic value Fair value / IV / Intrinsic value per share = equity value ÷ shares outstanding Angie's estimate of what one share is worth, built from the company's own cash rather than from what anyone will pay. Compare it to today's price. Tap to flip ↻ ↻ Back 67 / 151
Intrinsic value How it is calculated
Intrinsic value = equity value ÷ shares outstanding
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Markets 68 / 151 IPO Initial public offering / Going public A company's first sale of stock to the public. It converts private ownership into something anyone can buy, and it is the moment a price becomes public. Tap to flip ↻ ↻ Back 68 / 151
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Markets 69 / 151 Limit order An instruction to trade only at a set price or better. It guarantees the price and guarantees nothing about whether you get filled at all. Tap to flip ↻ ↻ Back 69 / 151
Limit order A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 70 / 151 Liquidation order Who gets paid when a company fails: secured creditors, then unsecured, then subordinated debt, then preferred, then common. Shareholders are last and usually get nothing. Tap to flip ↻ ↻ Back 70 / 151
Liquidation order A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 71 / 151 Liquidity How easily something can be sold near its quoted price. A liquid stock absorbs your order; an illiquid one moves against you as you fill it. Tap to flip ↻ ↻ Back 71 / 151
Liquidity A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 72 / 151 Lock-up A period after an IPO during which insiders may not sell. Its expiry releases a large block of supply on a known date, and the price usually knows it is coming. Tap to flip ↻ ↻ Back 72 / 151
Lock-up A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 73 / 151 MACD Moving average convergence divergence The gap between a fast and a slow moving average, plotted against its own average. Widening upward means momentum is building, narrowing means it is fading. Tap to flip ↻ ↻ Back 73 / 151
MACD A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 74 / 151 Margin Borrowing from your broker to buy more than your cash allows. It multiplies gains, losses and the chance of being forced to sell at the worst moment. Tap to flip ↻ ↻ Back 74 / 151
Margin A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 75 / 151 Margin of safety How far the price must sit from fair value before Angie calls it anything but fair: at least this much upside to be undervalued, at least this much downside to be overvalued. It exists because the estimate itself can be wrong. Tap to flip ↻ ↻ Back 75 / 151
Margin of safety A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 76 / 151 Market cap Market capitalisation / Market capitalization = price × shares outstanding What the market currently values the equity at. Tap to flip ↻ ↻ Back 76 / 151
Market cap How it is calculated
Market cap = price × shares outstanding
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Markets 77 / 151 Market maker A firm that continuously quotes both a buy and a sell price, so there is always someone on the other side. It earns the spread for taking that risk. Tap to flip ↻ ↻ Back 77 / 151
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Markets 78 / 151 Market order An instruction to trade immediately at whatever price is available. It guarantees execution and guarantees nothing about the price you get. Tap to flip ↻ ↻ Back 78 / 151
Market order A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 79 / 151 Market return The expected long-run return of the broad market. Subtract the risk-free rate from it and what remains is the equity risk premium. Tap to flip ↻ ↻ Back 79 / 151
Market return A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 80 / 151 Max drawdown The deepest fall from a peak before a new peak was reached. The number that decides whether a strategy is one you could actually hold through. Tap to flip ↻ ↻ Back 80 / 151
Max drawdown A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 81 / 151 Mean reversion The tendency of a stretched price to drift back toward its own average. Angie measures how often that actually happened for a name rather than assuming it will. Tap to flip ↻ ↻ Back 81 / 151
Mean reversion A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 82 / 151 Monetary policy The central bank setting the price of money to manage inflation and employment. Its main transmission into markets is the discount rate. Tap to flip ↻ ↻ Back 82 / 151
Monetary policy A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 83 / 151 Mutual fund Open-end fund A pooled fund that issues and redeems shares continuously at net asset value, priced once a day after the close rather than traded live. Tap to flip ↻ ↻ Back 83 / 151
Mutual fund A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 84 / 151 Net asset value NAV = (assets − liabilities) ÷ shares What one share of a fund is actually worth, based on what the fund holds. A mutual fund always trades at it; a closed-end fund often does not. Tap to flip ↻ ↻ Back 84 / 151
Net asset value How it is calculated
Net asset value = (assets − liabilities) ÷ shares
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Valuation 85 / 151 Net debt = total debt − cash Positive means a net borrower, negative means net cash. Subtracted from enterprise value to reach what shareholders own. Tap to flip ↻ ↻ Back 85 / 151
Net debt How it is calculated
Net debt = total debt − cash
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Valuation 86 / 151 Net-debt override Sets net debt by hand. Mostly used to supply industrial-only debt for a manufacturer whose in-house lending arm inflates the reported figure. Tap to flip ↻ ↻ Back 86 / 151
Net-debt override A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 87 / 151 No value NO_VALUE / Refusal Angie's refusal. A discounted cash flow cannot honestly price a bank, an insurer, a REIT or a company burning cash with no history of earning any, so it declines rather than inventing a number. Tap to flip ↻ ↻ Back 87 / 151
No value A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 88 / 151 Non-systematic risk Idiosyncratic risk / Specific risk Risk specific to one company or industry. It can be diversified away, so the market does not pay you for carrying it. Tap to flip ↻ ↻ Back 88 / 151
Non-systematic risk A fuller explanation of this one is still being written. The definition above is the short answer.
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Statements 89 / 151 Operating cash flow OCF / Cash from operations Cash the core business actually generated, before anything is spent on maintaining or expanding it. Harder to massage than reported earnings. Tap to flip ↻ ↻ Back 89 / 151
Operating cash flow A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 90 / 151 Option A contract giving the right, but not the obligation, to trade something at a set price before a set date. The buyer has the right and the seller has the obligation. Tap to flip ↻ ↻ Back 90 / 151
Option A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 91 / 151 Option premium What the buyer pays the seller for the contract. It is the option's price, and it is made of exactly two things: intrinsic value and time value. Tap to flip ↻ ↻ Back 91 / 151
Option premium A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 92 / 151 Order book Book / Level 2 / Depth The list of resting buy and sell orders at each price. The inside of it is the bid and the ask; the rest is depth, which the free IEX feed does not publish. Tap to flip ↻ ↻ Back 92 / 151
Order book A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 93 / 151 Order imbalance Book imbalance The share of the displayed size sitting on the bid versus the ask. Bid heavy says buyers are queued; ask heavy says sellers are. A lean, not a forecast, and it changes every second. Tap to flip ↻ ↻ Back 93 / 151
Order imbalance A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 94 / 151 Out of sample Validation / Holdout Testing on data the search never saw. Angie hides the last quarter of history, then re-runs the winners on it, and flags any whose result collapses. Tap to flip ↻ ↻ Back 94 / 151
Out of sample A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 95 / 151 PEG Price/earnings to growth = forward P/E ÷ growth A P/E adjusted for how fast the company is growing. Around 1.0 is conventionally treated as fair, though the convention has little theory behind it. Tap to flip ↻ ↻ Back 95 / 151
PEG How it is calculated
PEG = forward P/E ÷ growth
A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 96 / 151 Perpetual growth Terminal growth The rate the company is assumed to grow at forever, once the explicit horizon ends. It feeds the Gordon-growth terminal value and cannot sensibly exceed the economy's long-run growth. Tap to flip ↻ ↻ Back 96 / 151
Perpetual growth A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 97 / 151 Point of control POC The price level with the most volume in a volume profile. Price tends to return to it and to move quickly through the thin rows either side of it. Tap to flip ↻ ↻ Back 97 / 151
Point of control A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 98 / 151 Preferred stock A share with a fixed dividend and priority over common stock, usually without a vote. It behaves more like a bond than like equity. Tap to flip ↻ ↻ Back 98 / 151
Preferred stock A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 99 / 151 Present value PV = future cash flow × discount factor What a future year's free cash flow is worth in today's money. Tap to flip ↻ ↻ Back 99 / 151
Present value How it is calculated
Present value = future cash flow × discount factor
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Markets 100 / 151 Primary market Where securities are sold for the first time and the money reaches the company. Every share trades here exactly once. Tap to flip ↻ ↻ Back 100 / 151
Primary market A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 101 / 151 Profit factor = gross profit ÷ gross loss How many dollars the winners made for every dollar the losers cost. Below 1.0 the strategy loses money regardless of how often it is right. Tap to flip ↻ ↻ Back 101 / 151
Profit factor How it is calculated
Profit factor = gross profit ÷ gross loss
A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 102 / 151 Prospectus The disclosure document for a securities offering. It is written by lawyers to be complete rather than readable, and the risk factors section is the part worth reading. Tap to flip ↻ ↻ Back 102 / 151
Prospectus A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 103 / 151 Put option The right to sell at the strike price. It gains value as the underlying falls, which makes it the standard way to buy insurance on a position. Tap to flip ↻ ↻ Back 103 / 151
Put option A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 104 / 151 Random search Sampling combinations at random instead of testing all of them. Cheap coverage of a space too large to walk, at the cost of possibly missing the best corner. Tap to flip ↻ ↻ Back 104 / 151
Random search A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 105 / 151 Recession A meaningful, broad decline in economic activity lasting more than a few months. Dated formally after the fact, which is of limited use while you are in one. Tap to flip ↻ ↻ Back 105 / 151
Recession A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 106 / 151 REIT Real estate investment trust A company owning income-producing property, required to pay out most of its income. It runs on funds from operations, which is why a cash-flow DCF cannot value one. Tap to flip ↻ ↻ Back 106 / 151
REIT A fuller explanation of this one is still being written. The definition above is the short answer.
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Statements 107 / 151 Revenue Sales / Top line Total sales over the trailing twelve months, before any cost is subtracted. Tap to flip ↻ ↻ Back 107 / 151
Revenue A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 108 / 151 Reverse split Fewer shares at a proportionally higher price. Economically neutral, and usually done to escape a delisting threshold, which is worth knowing. Tap to flip ↻ ↻ Back 108 / 151
Reverse split A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 109 / 151 Rights Rights offering A short-term right given to existing shareholders to buy new shares below market price, so their stake is not diluted by the issue. Tap to flip ↻ ↻ Back 109 / 151
Rights A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 110 / 151 Risk-free rate The 10-year Treasury yield, standing in for the return available with essentially no risk. Every other rate in the model is built on top of it. Tap to flip ↻ ↻ Back 110 / 151
Risk-free rate A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 111 / 151 RSI Relative strength index A 0 to 100 gauge of how one-sided recent moves have been. Conventionally below 30 is oversold and above 70 overbought, though a strong trend can hold an extreme for weeks. Tap to flip ↻ ↻ Back 111 / 151
RSI A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 112 / 151 SEC Securities and Exchange Commission The federal securities regulator. Its disclosure regime is why public financial statements exist at all, and therefore why any of this can be computed. Tap to flip ↻ ↻ Back 112 / 151
SEC A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 113 / 151 Secondary market Trading between investors, which is what an exchange is. The company receives nothing when its shares change hands here. Tap to flip ↻ ↻ Back 113 / 151
Secondary market A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 114 / 151 Secondary offering A sale of shares after the IPO. If the company issues new ones it raises money and dilutes holders; if an existing holder sells, the company gets nothing. Tap to flip ↻ ↻ Back 114 / 151
Secondary offering A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 115 / 151 Settlement T+1 The day a trade actually completes and ownership transfers. US equities settle one business day after the trade, which is what T+1 means. Tap to flip ↻ ↻ Back 115 / 151
Settlement A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 116 / 151 Shares outstanding Share count The share count that converts a whole-company equity value into a per-share figure. Getting it wrong scales every valuation by exactly the same error. Tap to flip ↻ ↻ Back 116 / 151
Shares outstanding A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 117 / 151 Sharpe ratio Return per unit of volatility. It asks how much turbulence you endured for the gain, so a smoother path scores better than a wild one that ends up level with it. Tap to flip ↻ ↻ Back 117 / 151
Sharpe ratio A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 118 / 151 Short selling Borrowing shares, selling them, and buying them back later. The gain is capped at 100 percent and the loss is not capped at all. Tap to flip ↻ ↻ Back 118 / 151
Short selling A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 119 / 151 Signal confidence Confidence threshold / Entry score The weighted entry score a bar must clear before the strategy opens a trade, built from trend and momentum agreement. It says nothing about whether a stock is cheap. Tap to flip ↻ ↻ Back 119 / 151
Signal confidence A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 120 / 151 SIPC Insurance that protects up to $500,000 of your assets if your broker fails. It covers the broker failing. It does not cover your investments falling. Tap to flip ↻ ↻ Back 120 / 151
SIPC A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 121 / 151 Startup beta adjust Dampens an unstable post-IPO beta by 15%. A company with only months of trading history measures its own novelty as much as its risk. Tap to flip ↻ ↻ Back 121 / 151
Startup beta adjust A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 122 / 151 Stock Share / Equity / Common stock A unit of ownership in a company. It carries a vote, a claim on whatever is left after everyone else is paid, and no promise of anything. Tap to flip ↻ ↻ Back 122 / 151
Stock A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 123 / 151 Stock split More shares at a proportionally lower price. Nothing about the company changes, and the whole pie is cut into more slices. Tap to flip ↻ ↻ Back 123 / 151
Stock split A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 124 / 151 Stop order Stop-loss A resting instruction that turns into a live order once the price crosses a trigger. Its purpose is to cap a loss without watching the screen. Tap to flip ↻ ↻ Back 124 / 151
Stop order A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 125 / 151 Strike price Exercise price The price at which an option can be exercised. Its distance from the current price determines almost everything about how the option behaves. Tap to flip ↻ ↻ Back 125 / 151
Strike price A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 126 / 151 Sum of PV Every discounted free cash flow across the explicit projection horizon, added up. Everything after the horizon is handled by the terminal value instead. Tap to flip ↻ ↻ Back 126 / 151
Sum of PV A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 127 / 151 Systematic risk Market risk Risk affecting the whole market at once. It cannot be diversified away, which is precisely why investors are paid a premium for bearing it. Tap to flip ↻ ↻ Back 127 / 151
Systematic risk A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 128 / 151 Target FCF margin For a company not yet generating cash, the steady-state margin it is assumed to reach. The most fragile assumption in the model, because nothing in the history supports it. Tap to flip ↻ ↻ Back 128 / 151
Target FCF margin A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 129 / 151 Tender offer A public offer to buy shares directly from holders, usually above the market price and usually as part of an acquisition. Tap to flip ↻ ↻ Back 129 / 151
Tender offer A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 130 / 151 Terminal method How value beyond the horizon is set: Gordon growth, which assumes cash flow grows forever at a fixed rate, or a multiple applied to the final year. Tap to flip ↻ ↻ Back 130 / 151
Terminal method A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 131 / 151 Terminal value Everything the business is worth beyond the projection horizon, set by Gordon growth or an exit multiple and then discounted back. It is usually the majority of the answer. Tap to flip ↻ ↻ Back 131 / 151
Terminal value A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 132 / 151 Tick rule Uptick / Downtick A way to guess which side started a trade: a print above the previous one is called a buy, below it a sell, equal keeps the last call. A proxy, since the feed does not say who crossed. Tap to flip ↻ ↻ Back 132 / 151
Tick rule A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 133 / 151 Time and sales The tape / Prints The running list of executed trades: time, price, size. Reading it is watching who is actually paying up, as opposed to the book, which is what people say they would do. Tap to flip ↻ ↻ Back 133 / 151
Time and sales A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 134 / 151 Top of book Inside market / NBBO The best bid and best ask and the size resting at each. It is what a market order trades against, and on one venue it is a sample of the whole market, not the whole market. Tap to flip ↻ ↻ Back 134 / 151
Top of book A fuller explanation of this one is still being written. The definition above is the short answer.
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Statements 135 / 151 Total debt Short-term plus long-term borrowings, before any cash is netted off. Tap to flip ↻ ↻ Back 135 / 151
Total debt A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 136 / 151 Total return What the account gained or lost across the whole test, start to finish. Tap to flip ↻ ↻ Back 136 / 151
Total return A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 137 / 151 Trailing P/E Price to earnings = price ÷ last-12-months EPS What the market pays today for each dollar the company earned last year. Tap to flip ↻ ↻ Back 137 / 151
Trailing P/E How it is calculated
Trailing P/E = price ÷ last-12-months EPS
A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 138 / 151 Unit investment trust UIT A fixed portfolio bought once and never managed, with a set termination date. No manager decides anything after it launches. Tap to flip ↻ ↻ Back 138 / 151
Unit investment trust A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 139 / 151 Upside Spread / Discount to intrinsic value How far intrinsic value sits above or below today's price. Positive means the model thinks the stock is cheap, negative means expensive. Tap to flip ↻ ↻ Back 139 / 151
Upside A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 140 / 151 Valuation confidence How far the model will stand behind its own answer. Low means free cash flow has been volatile, the price sits far above what the business generates, or a margin had to be guessed. It is not the strategy signal score. Tap to flip ↻ ↻ Back 140 / 151
Valuation confidence A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 141 / 151 Verdict Undervalued / Overvalued / Fairly valued Undervalued, fair or overvalued, decided by where the price sits against intrinsic value once the margin of safety is applied. Tap to flip ↻ ↻ Back 141 / 151
Verdict A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 142 / 151 Volatility How much a price moves around, usually stated as annualised standard deviation. It is a measure of variability, not of danger, though the two often coincide. Tap to flip ↻ ↻ Back 142 / 151
Volatility A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 143 / 151 Volume profile Market profile A histogram of how much traded at each price over a window, drawn sideways on the chart. Its widest row is the point of control: the price the market spent the most time agreeing on. Tap to flip ↻ ↻ Back 143 / 151
Volume profile A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 144 / 151 VWAP Volume-weighted average price = Σ(price × volume) ÷ Σ(volume), reset each session The average price paid across a session, weighted by how much traded at each price. Institutions grade their fills against it, so it acts as the day's fair-value line. Tap to flip ↻ ↻ Back 144 / 151
VWAP How it is calculated
VWAP = Σ(price × volume) ÷ Σ(volume), reset each session
A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 145 / 151 WACC Weighted average cost of capital / Discount rate Cost of equity and cost of debt blended by how much of each the company uses. This is the rate every future dollar is discounted at, and it is the single most leveraged input in the model. Tap to flip ↻ ↻ Back 145 / 151
WACC A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 146 / 151 Warrant A long-dated right to buy stock at a fixed price, usually issued attached to a bond or preferred offering as a sweetener. Tap to flip ↻ ↻ Back 146 / 151
Warrant A fuller explanation of this one is still being written. The definition above is the short answer.
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Valuation 147 / 151 Why interest rates move fair value Rates and valuation / Why big companies look expensive A higher safe interest rate makes future cash worth less today, so a cash-flow valuation lowers companies whose price rests on years of growth. With Treasuries near 5%, most of the biggest names read below their price. Tap to flip ↻ ↻ Back 147 / 151
Why interest rates move fair value A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 148 / 151 Win rate The share of trades that made money. High on its own means little, since many small wins and one catastrophic loss still lose. Tap to flip ↻ ↻ Back 148 / 151
Win rate A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 149 / 151 Yield curve Government bond yields plotted against maturity. It normally slopes up, and its inversion has preceded most recessions, though not on any useful schedule. Tap to flip ↻ ↻ Back 149 / 151
Yield curve A fuller explanation of this one is still being written. The definition above is the short answer.
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Markets 150 / 151 Yield to maturity YTM The total return on a bond held to the end, counting both interest and the pull toward face value. It is the bond's internal rate of return. Tap to flip ↻ ↻ Back 150 / 151
Yield to maturity A fuller explanation of this one is still being written. The definition above is the short answer.
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Strategy 151 / 151 Z-score Standard deviations / Sigma How many standard deviations today's price sits from its recent average. Two sigma below means a move this far down happened on roughly one day in forty. Tap to flip ↻ ↻ Back 151 / 151
Z-score A fuller explanation of this one is still being written. The definition above is the short answer.
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↑ Accredited investor ↓
A valuation is arithmetic performed on assumptions. Nothing here is a secret formula, and none of it requires a finance degree. Start with discounted cash flow if you want the whole idea in one page, or intrinsic value if you want to know what the big number on a screener actually claims. All 151 terms are in the deck above.
Educational content, not investment advice. Angie explains how a valuation is built so you can judge it yourself. What you do with that is your call.
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