A short-term trading strategy that seeks to profit from small price changes.
Execution Speed: Extremely high, often seconds to minutes.
Tools: DOM (Depth of Market), hotkeys, fast brokers.
The market where securities are traded after their initial issuance.
Example: Buying shares of Apple on the NASDAQ after its IPO.
Tradable financial assets such as stocks, bonds, ETFs, and derivatives.
An order to sell a specific quantity of a security or commodity.
A sharp decline in price due to heavy selling pressure. Often driven by panic, bad news, or macroeconomic changes.
The actual exchange of money and securities after a trade is executed.
Standard Timeframes:
A measure of risk-adjusted return.
Formula: (Portfolio Return − Risk-Free Rate) / Standard Deviation of Return
Used to compare investment performance relative to volatility.
The total number of shares sold short but not yet covered.
High short interest: May indicate bearish sentiment - or potential for a short squeeze.
A strategy where a trader borrows and sells a security, aiming to buy it back at a lower price.
Profit if: Price declines
Risks: Unlimited potential loss if price rises
An indication to enter or exit a trade, generated by technical indicators, news, or algorithmic models.
A single-leg option refers to an options trading position that consists of only one options contract, either a call or a put.
The difference between the expected price of a trade and the actual price executed.
Occurs during: High volatility or low liquidity
Example: Expected to buy at $100, but trade fills at $100.20 = $0.20 slippage
Technology that automatically searches multiple trading venues to find the best execution for an order, based on price, speed, and cost.
A form of market manipulation involving placing fake orders to mislead other traders. Once the market reacts, the spoofer cancels the orders and trades in the intended direction.
Illegal in most jurisdictions.
The difference between the bid and ask price.
Tight spread: Sign of high liquidity.
Wide spread: Sign of low liquidity or volatility.
A type of cryptocurrency designed to maintain a stable value by being backed by assets like fiat currency (e.g., USD).
Examples: USDC, USDT
A corporate action in which a company issues more shares to shareholders, typically to lower the price per share and make it more accessible to a wider range of investors. For example, a 3-for-1 stock split means shareholders receive 2 additional shares for every 1 share they already own.
A Stop Order in trading is an instruction to buy or sell an asset automatically once its price reaches a certain level.
A stop order that becomes a limit order once triggered. It gives more control over price but no guarantee of execution.
An order to sell (or buy) a security when it reaches a specific price to limit potential losses.
Example: Buy at $50, set stop-loss at $45.
A price level where an asset tends to stop falling due to increased demand.
Technical traders use this to identify buying opportunities.
A trading strategy aiming to capture price swings over several days to weeks.
Based on: Technical analysis, momentum indicators.
A rules-based approach to trading using predefined criteria, often powered by algorithms.
Opposite of: Discretionary trading.