Every term the industry uses to sound clever, in plain English. Search it, or filter by topic.
Testing a strategy on past data to see how it would have done. Useful — but easy to fool yourself with, because the past is the one thing you can always "predict." See overfitting.
What your broker charges you per trade. Small on its own, but it's paid on every single trade, win or lose.
Earning returns on your past returns. It's slow at first and then surprisingly fast — which is also why anything that interrupts it (like costs) hurts more than it first appears.
Trying so many strategies that one looks brilliant purely by luck. The more you try, the better the luckiest one looks — and the less it actually means.
How far your account has dropped from its highest point. Losses and gains aren't symmetric: a −50% drawdown needs a +100% gain just to get back to where you were.
A real, repeatable reason your trades make money on average. Without one, trading is just paying costs to gamble.
What a typical trade makes, winners and losers averaged together. Positive expectancy is the whole game — win rate alone doesn't tell you if you're making money.
Spread, commission and slippage added up — the total cost of trading. It never has a losing day, and what matters is its size compared to what each trade makes.
The mathematically "optimal" bet size for fastest long-run growth. Almost nobody uses the full amount — it's far too wild — most trade a fraction of it for a smoother ride.
Controlling a bigger position than your cash, using borrowed money. It magnifies gains and losses equally — the fast road to both riches and ruin.
How easily you can buy or sell without moving the price. Thin liquidity means worse fills and more slippage.
Going "long" bets a price will rise; going "short" bets it will fall.
The deposit your broker holds against a leveraged position. Run too low on it and your positions get closed for you, often at the worst moment.
The idea that a stretched price tends to snap back toward a middle or "fair" level.
The idea that what's been moving tends to keep moving — for a while. The opposite instinct to mean reversion.
Running lots of random "what if" futures to see the whole range of outcomes, instead of trusting one tidy line. Most of POC's simulators do this.
Data you never used to build or tune a strategy. A real edge still works on it; a fitted one falls apart. The honest test.
Tuning a strategy so tightly to past data that it just memorised the random noise — and then breaks the moment it meets anything new.
In volume profile, the price where the most trading actually happened — the market's centre of gravity, where value really sits once you strip out the noise. (Yes — the app's named after it.)
How much you put on a trade. The single biggest thing deciding whether a rough patch is a scratch or a disaster.
The chance of losing so much you're effectively out of the game. Bet small enough and it stays near zero — even with a genuine edge.
How much you stand to make versus lose on a trade. "R" is one unit of risk — a "3R winner" makes three times what you put at risk.
How many trades or data points you're judging from. Small samples fool people constantly — you need a lot before a result means much.
The order your good and bad years arrive in. Once you're paying money in or drawing it out, the order matters — sometimes a great deal.
Return measured against how bumpy the ride was — roughly, reward per unit of stress. Higher is smoother for the same return.
Getting filled a little worse than you hoped — the price you wanted slips away, especially in fast markets.
The gap between the buy price and the sell price. You cross it going in and again coming out — a cost on every round-trip.
A pre-set exit that caps how much a trade can lose. The seatbelt you fasten before you need it.
Only ever seeing the winners. Blown-up accounts and dead funds don't post their results, so trading looks far easier than it really is.
A pre-set exit that locks in a winning trade at a chosen level.
The band of prices where most of a session's volume traded — roughly where the market agreed on "fair" for the day.
How bumpy the ride is. More volatility means a wider spread of outcomes — bigger ups and bigger downs.
The quiet way bumps eat returns. A +50% followed by a −50% leaves you down 25%, not back to flat. Smoother compounds better.
The share of your trades that make money. On its own it means little — a 35% win rate can be very profitable if the winners are big enough.
Missing a term you'd like explained plainly? That's the kind of thing worth adding. Nothing here is advice — just plain-English definitions.