The whole library
74 articles · page 1 of 2
Clear filtersThe Inverted Cup and Handle Set-Up
A rounded top and decline back to a prior low, then a small drift above it, and a test of the level the structure is organised around.
The Volatility Squeeze Set-Up
A market whose range has contracted to the narrowest it has been in months, which says a large move is coming without saying anything at all about its direction.
The Inverse Head and Shoulders Set-Up
Three lows with the middle one deepest, two rallies between them forming a neckline, and the break of that neckline as the confirmation.
The Head and Shoulders Top Set-Up
Three highs with the middle one tallest, two dips between them forming a neckline, and the break of that neckline as the confirmation.
The Diamond Top Set-Up
A top that first broadens into wider and wider swings and then contracts back into a coil, leaving a diamond outline and a narrowing lower boundary that ends it.
Short Sale Rules and Restrictions
Short selling is permitted and constrained. The constraints are specific, they change during stress, and they affect what is possible rather than what is advisable.
ECNs, Dark Pools and Market Fragmentation
Trading in a single security happens across dozens of venues. Some display their quotes and some do not, and the consolidated picture is assembled from all of them.
Working Capital and the Cash Conversion Cycle
The gap between paying for inputs and collecting for outputs has to be funded by somebody. Which side funds it says a lot about a company's position with its customers and suppliers.
Segment Reporting
Consolidated results average together businesses that may be moving in opposite directions. The segment note is where that averaging is undone.
Quality of Earnings
Two companies can report the same profit and one of the numbers is more likely to persist. Quality is about persistence and about how much of the profit is cash.
Revenue Recognition
When a sale becomes revenue is a judgement governed by a five-step framework. The judgement is where a substantial share of accounting problems have originated.
Pension Obligations
A defined benefit plan is a long-dated liability whose measured size depends on a discount rate. Small changes in assumptions move it substantially.
Accounting Red Flags
A checklist assembled from what has actually preceded accounting failures. None of the items is proof of anything, and several together are a pattern.
Return on Equity, Assets and Invested Capital
Profit means little without knowing how much capital was needed to produce it. These ratios answer that, and the differences between them are mostly about leverage.
Discounted Cash Flow, in Plain English
The theory every multiple is a shortcut for: a business is worth the cash it will produce, discounted for the fact that future cash is worth less than cash today.
Sum of the Parts
Valuing each business within a company separately and adding them up. Useful where the parts deserve different multiples, and dependent on disclosure that may not exist.
Residual Income
Valuing a company as its book value plus the present value of the profit it earns above its cost of capital. It puts the return-against-cost comparison at the centre.
Scenario and Sensitivity Analysis
Varying the inputs to see how much the answer moves. It converts a point estimate into a range and identifies which assumption is actually carrying the conclusion.
ADX and Trend Strength
ADX measures how strongly a market is trending without saying which way. Its real use is deciding which other indicators are appropriate right now.
Beta and Volatility
Two different measures of movement. Historical volatility says how much a security moves; beta says how much of that movement is shared with the market.
Ichimoku Kinko Hyo
Five lines intended to be read as one picture. Every component is a midpoint of a range or a shifted copy, which is what makes the whole thing derived from the same series.
Volume Profile
Volume plotted against price rather than against time. It answers where trading happened, which a conventional volume bar cannot.
Market Profile
A distribution of time spent at each price rather than volume. Built for a session, it describes where the market accepted a price and where it rejected one.
Elliott Wave, Assessed
A framework describing price as a nested sequence of five-wave and three-wave structures. Widely followed, and difficult to falsify in the form it is usually applied.
The Wyckoff Method, Assessed
A framework describing markets as cycles of accumulation and distribution driven by large operators. Its mechanism is plausible; its identification is retrospective.
Volatility Contraction
A sequence of successively shallower pullbacks, each on lighter volume. It is less a shape than a process, and the process is supply being absorbed.
Failed Patterns, and What They Tell You
Most patterns fail. That is the base rate rather than a defect, and a failure carries real information because of who it traps.
Island Reversals
A cluster of bars separated from everything around it by gaps on both sides. Rare, unambiguous to identify, and about the population of holders trapped inside it.
Renko and Point and Figure
Two chart styles that remove time from the horizontal axis entirely. A new mark appears only when price moves a defined amount.
Shelf Registrations and At-the-Market Programs
A shelf pre-clears securities so they can be sold on short notice. An at-the-market offering is the quiet mechanism that sells them without an announcement.
Schedule 13D and Schedule 13G
Both are filed after crossing five percent of a class. Which one is filed is the entire message: one signals intent to influence, the other signals passivity.
Prospectus Supplements (424B)
The filing that sets the final terms of an actual sale under an existing registration. When a stock gaps down overnight on an offering, this is usually the document.
Form 144
Notice of an intended sale of restricted or control securities, filed before the sale rather than after. It is one of the few genuinely forward-looking filings.
Tender Offers and Merger Filings
When one company moves to acquire another, a specific set of filings follows on a defined schedule. The gap between the offer price and the market price is the market's estimate of whether it closes.
SEC Comment Letters
Correspondence in which SEC staff question a company's disclosure. Published once resolved, and almost nobody reads them.
Form 11-K
The annual report of an employee benefit plan that holds the company's own stock. Obscure, audited, and occasionally the only place a number appears.
Going Private
When a company or its insiders take it private, an additional filing is required, and it demands disclosure that an ordinary merger does not.
Reg A+ and Form D
Two routes to raising capital without a full registration. One is a limited public offering; the other is a private placement with a short notice filing.
XBRL and Structured Filing Data
Filings are tagged so that individual figures can be extracted by machine. It makes comparison across thousands of companies possible, with a specific set of caveats.
Quantitative Easing and Tightening
Buying or running off bonds to influence longer-term rates, used when the policy rate alone is insufficient. It affects the long end, which the funds rate reaches only indirectly.
Yield Curve Inversion as a Recession Signal
Short yields above long ones has preceded every modern US recession. The record is genuinely striking and the lag is long enough to make it close to useless for timing.
Money Supply
Aggregate measures of money in the economy. Their relationship to inflation is theoretically clear, empirically unstable, and the subject of a long argument.
Financial Conditions Indices
Composites combining rates, spreads, equity prices and the currency into a single measure of how easy it is to obtain financing.
The Kelly Criterion
A formula for the position size that maximises long-run growth. Mathematically clean, extremely sensitive to inputs nobody knows, and almost never used at full size.
Hedging
Taking an offsetting position to reduce an exposure. Every hedge costs something, and the cost is frequently less visible than the risk it removes.
Tail Risk
The rare, large losses that dominate long-run outcomes. Standard risk measures are built on a distribution that understates exactly these events.
Correlation Between Strategies
Running several methods at once diversifies only to the extent they fail at different times. Most methods within one style fail together.
Embedded Options
A call gives the issuer the right to repay early; a put gives the holder the right to demand repayment. Each is an option, and someone pays for it.