Every term, in plain English

Ticker

The short code a stock or fund trades under. NVDA is Nvidia. A suffix tells you the exchange: .TO is the Toronto Stock Exchange, .V is the TSX Venture Exchange, and -USD marks a cryptocurrency priced in US dollars.

Closing price (the close)

The last price of the trading day, at 4 pm New York time for US stocks. Every rule on Be The Puck looks only at closes, never at the price in the middle of the day, because intraday prices swing around and would trigger false signals. A weekly close is Friday's close; a month-end close is the close on the last trading day of the month.

Explained in depth: How to read a Be The Puck page

Adjusted price

When a company splits its shares 2-for-1 the price halves overnight, and when it pays a dividend the price drops by that amount. Adjusted prices rewrite the history so those events don't look like real gains or losses. Be The Puck uses adjusted prices, so returns include dividends.

Log scale

On a normal chart, a move from $100 to $200 looks ten times bigger than a move from $10 to $20, even though both are a 100% gain. On a log scale, equal distances mean equal percentage changes. Be The Puck's growth charts use log scale so early years aren't squashed flat.

ETF (exchange-traded fund)

A fund you buy and sell like a stock, but which holds a basket of investments. SPY holds the 500 stocks in the S&P 500; GLD holds gold; TLT holds long-term US government bonds. ETFs are the usual way to own a whole market in one trade.

Index

A list of stocks used to track a market, such as the S&P 500 (500 large US companies), the Nasdaq-100, or Canada's S&P/TSX 60. You can't buy an index directly, but index funds and ETFs copy them.

Market cap

Share price multiplied by the number of shares: what the stock market says the whole company is worth. Apple is worth trillions of dollars; some micro caps on Be The Puck are worth under $10 million.

Micro cap

Small public companies, usually under about $300 million in market cap (small caps run up to a few billion). Their prices swing much more than big companies, few people trade them, and the gap between buying and selling prices is wide, so trading them costs more. Be The Puck's backtests assume 0.30% per switch for micro caps instead of 0.05% for that reason.

52-week high and low

The highest and lowest prices over the last year. Mark Minervini's Trend Template wants a stock at least 30% above its 52-week low and within 25% of its 52-week high: well off the bottom and near the top.

Currency-hedged

A foreign stock bought in another currency moves with both the company and the exchange rate. A currency-hedged fund (like STHH, which holds STMicroelectronics) strips out the exchange-rate part so you only get the company's move.

Candlestick

Each candle shows one period's open, high, low and close. The body spans open to close; the wicks reach the high and low. Hollow or green means it closed up; filled or red means it closed down.

Explained in depth: Reading candlesticks

Bid, ask and spread

Buyers post bids, sellers post asks. The gap between the best of each is the spread, a hidden cost of every trade. Thinly traded stocks have wide spreads.

Explained in depth: Bids, asks and why prices move

Order book

The live list of bids and asks waiting at each price. A market order takes from it; a limit order joins it.

Explained in depth: Bids, asks and why prices move

Market and limit orders

A market order fills immediately at whatever the order book offers. A limit order sets the most you'll pay or the least you'll accept, and may not fill.

Explained in depth: Bids, asks and why prices move

CDR (Canadian Depositary Receipt)

A Canadian-dollar security on Cboe Canada (formerly NEO) that tracks a U.S. stock, usually with currency hedging and a smaller price. Be The Puck's watchlist maps a CDR to the U.S. shares it tracks.

Cap-weighted and equal-weight

Most indexes are cap-weighted, so the biggest companies move them most. An equal-weight version gives every stock the same weight; when it lags, a few giants are carrying the market.

Explained in depth: Indexes and the whole market

Moving average

The average of the last n closing prices, recalculated each day so it 'moves' along with the price. A 50-day moving average is the average of the last 50 closes. It smooths out day-to-day noise so you can see which way the price is really heading. Every rule on Be The Puck is built on moving averages.

Explained in depth: Moving averages, explained

SMA (simple moving average)

Add up the last n closes and divide by n. Every day counts equally, so a big move 49 days ago matters as much as yesterday's. That makes an SMA steady but slow to react.

Explained in depth: Moving averages, explained

EMA (exponential moving average)

A moving average that weights recent prices more heavily, so it turns faster than a simple moving average of the same length. A 21-day EMA reacts to a sharp drop within days; a 21-day SMA takes longer. Faster means earlier signals but also more false ones.

Explained in depth: Moving averages, explained

Band (or cloud)

The shaded space between two moving averages, such as a 12-day and 21-day EMA. Price above the whole band is read as an uptrend, below it as a downtrend, and inside it as undecided. Band rules on Be The Puck change their call only when price closes fully above or below the band, and hold their last call while price is inside it. That cuts down on false signals.

Explained in depth: Moving averages, explained

Crossover

The moment a faster moving average moves above (or below) a slower one, or price crosses an average. Crossovers are the most common trigger in trend-following rules.

Explained in depth: Moving averages, explained

Golden cross and death cross

A golden cross is when the 50-day moving average rises above the 200-day; a death cross is the reverse. They're popular in financial media because they're simple, but by the time one happens much of the move has already occurred.

Uptrend and downtrend

An uptrend is a price that keeps making higher highs and higher lows, usually sitting above a rising moving average. A downtrend is the opposite. Trend-following rules try to own stocks in uptrends and step aside in downtrends.

Support and resistance

Support is a price level (or a moving average) where declines have tended to stop and bounce. Resistance is a level where rallies have tended to stall. Traders watch both because many other traders are watching them too.

Trend following

A strategy of owning an asset while its price trend is up and stepping aside when it turns down, instead of trying to predict tops and bottoms. It accepts being late on purpose: it gives up the start and end of every move in return for avoiding most of the long declines.

Explained in depth: Trend following: why it works and when it doesn't

Momentum

The tendency for prices that have been rising to keep rising for a while, and falling ones to keep falling. Time-series momentum compares an asset with its own past, for example 'is it higher than 12 months ago?', as in the Moskowitz, Ooi and Pedersen rule.

Explained in depth: Momentum: own what's rising

Bull market and bear market

A bull market is a long period of rising prices. A bear market is usually defined as a fall of 20% or more from the last peak. Trend rules earn most of their keep in bear markets, by being out of the market for much of the fall.

Stage 2 (Stage Analysis)

Stan Weinstein's model of a stock's life: Stage 1 basing (flat), Stage 2 advancing (price above a rising 30-week moving average), Stage 3 topping, and Stage 4 declining. The rule is to own stocks only in Stage 2.

Trading rule (strategy)

A written-down set of instructions for when to own something and when not to, such as 'own it while the month-end price is above its 10-month average'. Because it's fixed, it can be tested on past prices and checked by anyone. Be The Puck tests seven of them.

Signal

What a rule says at a given moment. On Be The Puck every rule gives one of two signals: IN (hold the stock) or OUT (hold cash, earning T-bill interest).

IN and OUT (the call)

Each rule makes a call on each stock. IN means the rule holds it. OUT means the rule has sold and is sitting in Treasury bills. The call only changes when a finished close crosses the rule's line.

Explained in depth: How to read a Be The Puck page

Next move (trigger level)

The exact closing price that would flip a rule from IN to OUT, or OUT to IN, at its next check. It's calculated from the rule's own formula, so if the stock closes past that level, the rule changes its call. The percentage beside it shows how far the price would have to move.

Explained in depth: How to read a Be The Puck page

Next check

When the rule next looks at the price. Daily rules check every close; weekly rules check Friday's close (Sunday for crypto); monthly rules check the last close of the month. Between checks the call can't change.

Whipsaw

When a rule jumps in on a rise, then gets thrown out by a quick drop (or the reverse), losing a little each time. Sideways, choppy markets produce strings of whipsaws. Fast rules suffer them most, which is why the daily PB EMA band switches around 25 to 30 times a year on index funds.

Explained in depth: Trend following: why it works and when it doesn't

Market timing

Moving in and out of the market instead of staying invested. Every rule on Be The Puck except buy-and-hold is a form of market timing. Research suggests rule-based timing mostly helps in big crashes and lags in between.

Explained in depth: Trend following: why it works and when it doesn't

Backtest

Running a rule on historical prices to see what it would have done. Be The Puck backtests every rule on every stock from 2005 (or the stock's first trading day), with trading costs and cash interest included. A backtest shows how a rule behaved, not what it will do next.

Explained in depth: How to read a backtest

Buy and hold

Buy it and never sell. It's the simplest strategy and the hardest to beat, so every rule on Be The Puck is graded against buying and holding the same stock over exactly the same dates.

Explained in depth: How to read a backtest

Benchmark

The yardstick a strategy is measured against. On Be The Puck the benchmark is always buy-and-hold on the same stock, so a rule only 'wins' if it beats doing nothing.

Annual return (CAGR)

The steady yearly growth rate that would turn the starting amount into the ending amount, also called compound annual growth rate (CAGR). It's compounded, so 10% a year for 20 years turns $10,000 into about $67,000, not $30,000.

Explained in depth: How to read a backtest

Total return

The full gain or loss over the whole period, dividends included. A total return of +300% means $10,000 became $40,000.

Drawdown

The drop from a peak to the lowest point before a new high. The worst drawdown is the biggest such drop in the whole test. It's the number that tells you how painful a strategy was to live with: a −55% drawdown means at the worst moment you'd lost more than half. Note it takes a +100% gain to recover from −50%.

Explained in depth: How to read a backtest

Volatility

How much returns swing around, measured as the standard deviation of daily returns scaled to a year. The S&P 500 runs at roughly 15 to 20%; a single tech stock might be 40%; Bitcoin 60% or more. Higher volatility means a bumpier ride and bigger drawdowns.

Explained in depth: How to read a backtest

Sharpe ratio

Return per unit of risk: the return earned above cash (T-bills), divided by volatility. It lets you compare a high-return, very bumpy strategy with a lower-return, smooth one. Higher is better. Over long periods a broad stock index usually lands around 0.4 to 0.6, and anything consistently above 1 is rare.

Explained in depth: How to read a backtest

Risk-adjusted return

Return judged against the risk taken to earn it. Two strategies that each return 8% a year aren't equal if one fell 55% along the way and the other 20%. The Sharpe ratio is the usual measure.

Explained in depth: How to read a backtest

Calls right (hit rate)

The share of a rule's finished calls that went the right way: an IN call is right if the price was higher by the next call, an OUT call is right if it was lower. Trend rules often score well under 50% because they take many small losses and a few large wins.

Explained in depth: How to read a backtest

Switches per year

How often a rule changes its call in an average year. Monthly rules switch once or twice; fast daily rules can switch 30 times. Every switch costs money in trading costs and, in a taxable account, can trigger tax.

Time invested

The share of days the rule held the stock. A rule invested 75% of the time spends a quarter of its life in T-bills.

Trading costs

Commissions plus the bid-ask spread (the gap between what buyers pay and sellers get). Be The Puck's backtests deduct 0.05% per switch for stocks and ETFs, 0.10% for crypto and 0.30% for micro caps.

Basis point

One hundredth of one percent. 100 basis points = 1%; 5 basis points = 0.05%. Used for small numbers like trading costs and interest-rate changes.

Treasury bills (T-bills)

Short-term loans to the US government, maturing in a year or less. They're as close to risk-free as it gets, so they stand in for 'cash'. When a rule is OUT, Be The Puck credits the money with the 13-week T-bill rate.

In-sample and out-of-sample

In-sample data is what a rule was designed or tuned on. Out-of-sample data is history the designer never looked at. A rule that only works in-sample was probably fitted to noise.

Explained in depth: How to read a backtest

Overfitting

Tweaking a rule's settings until it looks great on past data. Test enough combinations and one will look brilliant by luck alone. That's why Be The Puck uses each thinker's published settings instead of picking the best-looking ones.

Explained in depth: How to read a backtest

Survivorship bias

Testing only on companies that still exist today. The ones that went bankrupt or were delisted aren't in the data, which flatters every strategy, buy-and-hold included.

Explained in depth: How to read a backtest

Beta

A measure of how much a stock moves with its benchmark index. Beta 1 moves with the market; 2 moves about twice as much; 0.5 about half. Be The Puck measures it on three years of weekly returns.

Explained in depth: Risk, volatility and position size

Downside capture

Average return in the market's down months ÷ the market's average return in those months. 150% means it fell one and a half times as much.

Crash exposure (the storm test)

A score out of 10 built from beta and downside capture (3 points), past crash drawdowns against the index (2), balance-sheet debt (3) and the two-year run-up (2). Low, Moderate, High or Very high. It describes fragility; it does not predict a crash.

Run-up

A large rise over a short period. Greenwood, Shleifer and You found U.S. industries up 100% or more in two years fell 40% or more within the next two years about half the time, usually after rising further first.

Indicator

Any number calculated from past prices, and sometimes volume, that a trading rule reads to make its call. Moving averages, the RSI and the MACD are all indicators. An indicator doesn't know anything the price doesn't; it just summarises it in a particular way.

Oscillator

An indicator that swings back and forth inside a fixed range, usually 0 to 100. The RSI, the stochastic, Williams %R and the Money Flow Index are oscillators. Readings near the top suggest a move is stretched upward; near the bottom, stretched downward.

Explained in depth: Oscillators and mean reversion

RSI (Relative Strength Index)

J. Welles Wilder's 1978 oscillator. It compares the size of recent up days with recent down days and scales the result from 0 to 100. The usual setting is 14 days; Larry Connors uses a 2-day RSI to spot sharp short-term dips. Not related to a stock's relative strength against the market, despite the name.

Explained in depth: Oscillators and mean reversion

Overbought and oversold

Labels for oscillator readings near the extremes of their range, such as RSI above 70 (overbought) or below 30 (oversold). They say a move looks stretched, not that it must reverse: in a strong trend a stock can stay overbought for weeks.

Explained in depth: Oscillators and mean reversion

Mean reversion

The idea that a price stretched far from its recent average tends to move back toward it. Mean-reversion plays buy sharp dips and sell the bounce, often only inside a longer uptrend. They are right more often than trend plays, but each win is small.

Explained in depth: Oscillators and mean reversion

MACD

Moving Average Convergence/Divergence, created by Gerald Appel in the late 1970s. The MACD line is the 12-day EMA minus the 26-day EMA, so it's above zero when the fast average is above the slow one. Its 9-day EMA is the signal line, and the difference between the two, drawn as bars, is the histogram.

Explained in depth: Momentum: own what's rising

Rate of change

How far a price has moved, in percent, over a set look-back: a 12-month rate of change of +20% means the price is 20% above where it was a year ago. Pring's KST and the Coppock curve are built from several smoothed rates of change.

Explained in depth: Momentum: own what's rising

ATR (Average True Range)

Welles Wilder's measure of how much a stock typically moves in a day. The true range is the day's high minus its low, stretched to include any gap from the previous close; the ATR averages it, usually over 14 or 20 days. Stops and channels set in ATRs adapt to each stock's normal volatility. The Turtles called it N.

Explained in depth: Volatility, ATR and trailing stops

Standard deviation

A measure of how widely values spread around their average. For prices, a bigger standard deviation means a more volatile stretch. Bollinger Bands sit two standard deviations above and below a 20-day average.

Explained in depth: Volatility, ATR and trailing stops

Bollinger Bands

John Bollinger's 1980s envelope: a 20-day simple average with bands two standard deviations above and below. The bands widen in volatile markets and squeeze together in quiet ones. Bollinger says a close outside a band usually means the move is continuing, not ending.

Explained in depth: Volatility, ATR and trailing stops

Trailing stop

A sell level that follows the price up but never moves down. If the stock rises, the stop rises with it; if the stock falls back to the stop, you're out. The Chandelier Exit, Supertrend and the Turtles' 2N stop are all trailing stops. A plain stop-loss is a fixed exit below the entry price.

Explained in depth: Volatility, ATR and trailing stops

Stochastic oscillator

Popularised by George Lane: where today's close sits within the recent high-low range, scaled 0 to 100. %K is the reading and %D its 3-day average. Larry Williams' %R is the same idea flipped upside down, from 0 to −100.

Explained in depth: Oscillators and mean reversion

Divergence

When price and an indicator disagree, for example the price makes a new high but the RSI makes a lower high. Many indicator inventors, including Wilder, Lane and Appel, treated divergences as their strongest signals. They are hard to test mechanically, so Be The Puck's versions mostly use simpler threshold rules.

Explained in depth: Oscillators and mean reversion

ADX and directional movement

J. Welles Wilder's system from 1978. +DI measures how far each day pushes above the previous high, −DI how far it pushes below the previous low. ADX smooths the gap between them into a 0–100 measure of trend strength: above 25 is a strong trend, below 20 no real trend.

Parabolic SAR

Wilder's 'stop and reverse' dots. In an uptrend the SAR starts below price and moves up a little faster each time the price makes a new high. When the price falls to it, the system flips. Be The Puck holds T-bills instead of flipping short.

Explained in depth: Volatility, ATR and trailing stops

Ichimoku cloud

Goichi Hosoda's 'equilibrium chart at a glance', published in Japan in the late 1960s. It plots mid-points of recent highs and lows over 9, 26 and 52 bars and shades a cloud between two of them, shifted forward. Price above the cloud reads as an uptrend.

Volume

The number of shares (or coins) traded in a period. Volume-based plays assume heavy buying or selling shows up in volume before it shows up fully in price.

Explained in depth: Reading volume

On-balance volume (OBV)

Joseph Granville's 1963 indicator. Each up day adds that day's volume to a running total and each down day subtracts it. A rising OBV suggests buyers are accumulating; Granville watched for OBV to turn before price did.

Explained in depth: Reading volume

Money flow

Measures that weight volume by price action. Marc Chaikin's Money Flow weighs each day's volume by where the close lands in that day's range: near the high counts as accumulation (buying), near the low as distribution (selling). The Money Flow Index is a volume-weighted RSI.

Explained in depth: Reading volume

Breakout

When the price closes beyond the edge of a recent range, for example above its highest high of the last 20 days. Breakout plays buy new highs on the theory that a stock escaping its range has started a new trend. Many breakouts fail and fall back, which is why they come with exits.

Explained in depth: Breakouts and channels

Price channel

A pair of lines that box in the price. A Donchian channel uses the highest high and lowest low of the last N days. A Keltner channel sits a few ATRs above and below an average. A close outside the channel is a breakout.

Explained in depth: Breakouts and channels

The Turtles

In 1983 commodity traders Richard Dennis and William Eckhardt recruited about two dozen novices through newspaper ads, taught them a rule-based breakout system in two weeks and gave them money to trade. Many did very well. Their rules, published in 2003, buy 20- or 55-day breakouts and size positions by ATR.

Explained in depth: Breakouts and channels

Relative strength

How a stock is doing compared with something else, usually the market. Divide the stock's price by the S&P 500's and you get a relative-strength line; if it's rising, the stock is beating the market. Stan Weinstein reads it from Mansfield charts. Not the same thing as the RSI.

Explained in depth: Momentum: own what's rising

Cross-sectional momentum

Momentum measured by comparing stocks with each other: rank the market by past return and buy the leaders. Jegadeesh and Titman's 1993 study is the classic. Be The Puck tests one stock at a time, so it uses time-series versions or a comparison with SPY instead.

Explained in depth: Momentum: own what's rising

Absolute and dual momentum

Gary Antonacci's terms. Absolute momentum holds an asset only if its own past return beat T-bills. Relative momentum picks the strongest of several assets. Dual momentum uses both.

Explained in depth: Momentum: own what's rising

Pullback

A short decline inside a longer uptrend. Larry Connors' plays buy pullbacks in stocks above their 200-day average and sell the bounce a few days later.

Seasonality

Return patterns tied to the calendar: the winter half of the year beating the summer half, the days around the turn of each month, the last days of December. Some have held up for a century; others may be luck found by searching through enough dates.

Explained in depth: Calendar effects

Exhaustion

The idea that a streak of buying or selling eventually runs out of fuel. Tom DeMark's setup counts nine closes in a row below (or above) the close four days earlier as a sign the streak is spent.

Explained in depth: Oscillators and mean reversion

Share (stock)

A slice of ownership in a company: its assets, profits and debts. Companies first sell shares to raise money; after that, shares trade between investors. Shares outstanding is how many slices exist.

Explained in depth: What a stock is, and what sets its price

IPO (initial public offering)

The first sale of a company's shares to the public, when it lists on an exchange. Waves of IPOs, especially of unprofitable companies, have often come near market peaks.

Earnings per share (EPS)

Net profit divided by the number of shares. If a company earns $1 billion and has 500 million shares, EPS is $2.

Explained in depth: What a stock is worth: earnings and P/E

P/E ratio

Price ÷ earnings per share. A P/E of 20 means paying $20 for each $1 of the last year's profit. Fast-growing or very steady companies tend to have high P/Es; slow or risky ones low P/Es. Meaningless when the company loses money.

Explained in depth: What a stock is worth: earnings and P/E

Forward P/E

Like the P/E, but divides by analysts' estimate of the next 12 months' profit. Lower than the trailing P/E when profits are expected to grow.

Explained in depth: What a stock is worth: earnings and P/E

Price to book (P/B)

Price ÷ book value (equity) per share: how the market values the company against its net assets on paper. Most useful for banks and insurers.

Price to sales

Market cap ÷ yearly revenue. Used to value companies that aren't profitable yet, where a P/E doesn't work.

Profit margin

Profit ÷ revenue. A 20% margin means 20 cents of each dollar of sales is profit.

Free cash flow

Cash from operations minus capital spending. Harder to dress up than accounting profit, and what actually pays dividends and debts.

Balance sheet

A snapshot of what a company owns and owes. It always balances: assets = liabilities + equity.

Explained in depth: Equity, debt and staying power

Equity (shareholders' equity)

Assets minus liabilities: the part of the company that belongs to shareholders on paper. Negative equity means debts exceed assets.

Explained in depth: Equity, debt and staying power

Debt to equity

Total debt ÷ equity. Shows how much of the business is financed by borrowing. Banks run high by design.

Explained in depth: Equity, debt and staying power

EBITDA

Earnings before interest, taxes, depreciation and amortisation. Net debt to EBITDA (debt minus cash, divided by EBITDA) is roughly how many years of operating earnings it would take to repay the debt; above 4× is stretched.

Interest cover

Operating profit ÷ interest. At 10× interest is easily paid; under 2×, a modest fall in profit makes the interest hard to pay.

Explained in depth: Equity, debt and staying power

Dividend yield

Yearly dividends per share ÷ share price. A $100 stock paying $3 a year yields 3%.

Analyst price target

A 12-month price forecast from a brokerage analyst. Useful as a summary of professional opinion, but targets lean optimistic and tend to follow the price.

CAPE (Shiller P/E)

Robert Shiller's cyclically adjusted price-to-earnings ratio: price over the ten-year average of real earnings. It has said a lot about the next ten years' returns and little about the next one.

Yield curve

The difference between long-term and short-term government bond yields. Normally long rates are higher. An inverted curve came before every U.S. recession since 1969, typically by 5 to 16 months.

Credit spread

How much more interest corporate borrowers pay than the government. Spreads widen when lenders fear defaults; they are often tightest just before trouble.

Sahm rule

Proposed by economist Claudia Sahm in 2019. It triggered early in every U.S. recession since 1960, and fired in 2024 without one.

VIX

Cboe's index of expected 30-day S&P 500 volatility, from option prices. Typically 12–20; it spiked above 80 in 2008 and 2020. It mostly jumps during a crash rather than before.

Recession

A significant, widespread decline in economic activity. U.S. recessions are dated by the National Bureau of Economic Research, often long after they start.

Bubble

When prices run far ahead of what the underlying businesses can earn, pushed by the belief that they'll keep rising. Clear in hindsight, hard to call in real time.

Explained in depth: Bubbles, crashes and the warning signs

Margin debt

Loans from brokers secured by investors' stocks. Borrowing amplifies gains and losses, and forced selling when prices fall can deepen a crash.

Market concentration

The share of an index in its largest companies. High concentration means the index is less diversified than its name suggests.

Explained in depth: Indexes and the whole market

Core and satellite

A way to split a portfolio: a large core you simply hold, plus a smaller satellite (or sleeve) where you apply a rule or take more risk. It limits the damage if the rule goes through a bad stretch.

Explained in depth: From signal to plan

Position sizing

Deciding how much money each holding gets. A common habit is capping any single stock at a small share of the portfolio, and keeping speculative names smaller still.

Explained in depth: From signal to plan

Rebalancing

Resetting a portfolio to its target mix, for example back to 70% stocks and 30% bonds after stocks have run up. It forces you to trim winners and top up laggards on a schedule.

Diversification

Spreading money across many holdings so that one company, sector or country going wrong can't sink you. An index fund is diversification in a single purchase.

Leverage

Borrowed money that magnifies results, up and down. For an investor it means buying with borrowed funds; for a company it means carrying a lot of debt. Highly leveraged companies are the ones most likely to be wiped out in a crash.

Short selling

Selling borrowed shares in the hope of buying them back cheaper. The research version of time-series momentum goes short; Be The Puck only tests the long-only version an individual can run, which sits in T-bills instead.

TFSA

Canada's Tax-Free Savings Account. Investment growth and withdrawals are tax-free, within your contribution room. Because selling inside a TFSA creates no tax bill, it's the natural place to run a rule that switches in and out.

Explained in depth: From signal to plan

RRSP

Canada's Registered Retirement Savings Plan. Contributions reduce your taxable income and growth isn't taxed until you withdraw, so trades inside it don't create a tax bill along the way.

Explained in depth: From signal to plan

Capital gains

The profit when you sell an investment for more than you paid. In a regular, non-registered account, every sale is a taxable event, so a rule that switches often can create a lot of tax paperwork and bills.

Explained in depth: From signal to plan

Superficial loss rule

A Canada Revenue Agency rule: if you sell at a loss and you (or someone affiliated with you) buy the same or identical investment within 30 days before or after, the loss is denied for now and added to the cost of the new shares. Fast rules that sell and re-buy can run into it.

Explained in depth: From signal to plan

Dividend

Cash a company pays its shareholders, usually quarterly. Be The Puck's returns include dividends because it uses adjusted prices.

Revenue impact

The live desk's read on whether a news story is likely to change a company's revenue (sales). A product delay or a big new contract is revenue-impacting; a CEO interview usually isn't.

Guidance

A company's own forecast for upcoming sales or profits. When a company raises or cuts guidance, the stock often moves more than it does on the actual quarter's results.

Earnings miss

When reported profits come in below what analysts expected. The size of the stock's reaction depends on how much the miss changes the story and the forecasts.

Batting average

The desk's scorecard for a news source or analyst: of their stories that implied a direction, the share where the stock actually moved that way the next day. The model is graded the same way.

Archetype

The desk's way of grouping companies by how they tend to behave in stress, based on public facts: a fortress mega-cap with lots of cash behaves very differently in a crash from a leveraged cyclical or a micro-cap.

Crash band

The approximate range of losses that companies of the same archetype suffered in past crashes, for example −60% to −90% for leveraged cyclicals in 2008. It's a historical guide, not a prediction.

Dilution

When a company issues new shares to raise money, each existing share becomes a smaller slice of the company. Cash-burning small companies dilute often, especially after a fall.

Liquidity

How easily something can be bought or sold quickly without moving its price. Apple is very liquid. A micro cap can be illiquid: a modest order can push the price, and in a panic buyers can disappear.