Decoding Alpha: Where Data Science Meets Wall Street.
Implied volatility is the market’s expected magnitude of an asset’s future price moves. Implied volatility is calculated by taking the current market price of an option, entering it into an option pricing model, such as Black-Scholes, and backing out the …
A pattern day trader (PDT) is a Financial Industry Regulatory Authority (FINRA) designation for those who make four or more day trades in a margin account over five days when the transactions account for more than six percent of total …
A stock split is a decision by the company’s board of directors to increase a company’s number of shares, causing a decrease in the stock price and making shares more affordable. A stock split does not change a company’s value …
Retail traders can beat institutional traders by being patient and targetting small and unregulated markets. Retail traders can wait for the best opportunities to present themselves, whereas institutional traders may need to make suboptimal investments to track benchmarks or investment …
Trading quotes distill the complex trading world into insightful, bite-sized nuggets of wisdom. No matter your level of experience, you’re sure to find value in these 20 trading quotes from some of the greatest traders. In this post, I’ll share …
The Turtle Traders experiment was conducted in the early 1980s by Richard Dennis and William Eckhardt to see whether anyone could be taught how to make money trading. The experiment involved taking a random group of people, teaching them a …
A hedge fund is a limited partnership of investors that can make extensive use of more sophisticated trading, portfolio construction, and risk management techniques to improve performance, such as short selling, leverage, and derivatives, in hopes of realizing substantial capital …
Investing quotes are popular for a reason — they allow you to learn the essential lessons from the greatest investors of all time in just a few short sentences. In this post, I will go over some of my favorite …
A security is an ownership or debt with value and may be bought and sold. Many types of securities can be broadly categorized into equity, debt, and derivatives. A stock is a type of security that gives the holder ownership, …
Year-over-year (YoY) is a method of analyzing data between two comparable periods on an annualized basis. Understanding how to calculate and what YoY values are can help you interpret financial and economic data more effectively. But it’s not enough to …