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- The degree by which the delta changes with respect to changes in the
underlying instrument’s price.
- Gann’s Square of 9
- A trading tool that relates numbers, such as a stock price, to degrees
on a circle.
- Gann Theory
- Various analytical techniques developed by legendary trader W.D. Gann.
- A day in which the daily range is completely above or below the previous
day’s daily range.
- Genetic Algorithms
- Algorithms that mimic the characteristics associated with evolution and
that are well-suited to optimization problems such as optimizing neural
- Genetic Programming
- In artificial intelligence, this form of programming automatically generates
a program from a set of primitive constructs.
- When a broker executes an order for another broker’s client and
the two brokers split the commission; the client pays nothing extra.
- Golden Mean or Golden Ratio
- The ratio of any two consecutive numbers in the Fibonacci sequence, known
as phi and equal to 0.618; a proportion that is an important phenomenon
in music, art, architecture and biology.
- Golden Section
- Any length divided so that the ratio of the smaller to the larger part
is equivalent to the ratio between the larger part and the whole and is
- Jargon; a loose term encapsulating a set of risk variables used by options
- Gross Domestic Product
- Value of all goods and services produced domestically.
- Growth Fund
- A more speculative mutual fund made up primarily of the growth or performance
stocks that are expected to appreciate in price more than the broad market
over an extended time period.
- Guaranteed Investment Contracts (GICs)
- A single lump-sum deposit that earns a guaranteed interest until a known
maturity date. GICs are issued by insurance companies.
- Hanning Weight
where weight (W) at point J in window width of N points is determined by
- In candlestick terminology, a small real body contained within a relatively
long real body.
- Head and Shoulders
- When the middle price peak of a given tradable is higher than those around
- Hedge Fund
- A mutual fund involving speculative investing in stocks and options.
- Herrick Payoff Index
- An index requiring two inputs, one of which is a smoothing factor known
as the multiplying factor and the other of which is the value of a one-cent
- Heuristic Bias
- The use of rules of thumb for decisions.
- Heuristic Method
- Problem solving approached by trying out several different methods and
comparing which pro vides the best solution.
- (computer science)Computational rules of thumb. Distinct from algorithms,
which are programs guaran teed to generate the correct result under all
circumstances, heuristics may only turn out to be correct a certain percentage
- Hidden node
- Elements that give a neural network the ability to learn nonlinear patterns.
The hidden nodes math ematically transform inputs by passing weighted sums
of those inputs through nonlinear functions.
- Hierarchical Neural Network
- In artificial intelligence, a neural network in which predictions derived
from networks at one level of the hierarchy are incorporated as inputs
at another level. This architecture lends itself to faster training, as
each network focuses learning solely on its own output.
- High Pass Frequency Filter
- A detrending filter that lets pass the high frequency noise and rejects
low frequency trend. Implemented by first applying a low pass filter to
the data, then subtracting the filtered data from the original data.
- To pay the offered price.
- Hines Ratio
- A modified put/call ratio that refines traditional option ratio analysis
by including the open interest figures in the equation and can be defined
as (Total put volume/Total put open interest) divided by (Total call volume/Total
call open interest)
- Historic Volatility
- How much contract price has fluctuated over a period of time in the past;
usually calculated by taking a standard deviation of price changes over
a time period.
- Historical Data
- A series of past daily, weekly or monthly market prices (open, high,
low, close, volume, open inter est).
- Hook Day
- A trading day in which the open is above/below the previous day’s
high/low and the close is below/above the previous day’s close with
- Implied Alpha
- The excess return expected from a stock to justify its current weighing
in the portfolio.
- Implied Volatility
- The volatility computed using the actual market prices of an option contract
and one of a number of pricing models. For example, if the market price
of an option rises without a change in the price of the underlying stock
or future, implied volatility will have risen.
- A sharply defined change in a series of input data being studied, such
as market prices or volume.
- Impulse Wave
A wave or cycle of waves that carries the current trend further in the
- In Play
- A stock that is the focus of a public bidding contest, as in a takeover
or bear raid.
- A call option whose strike price is lower than the stock or future’s
price, or a put option whose strike price is higher than the underlying
stock or future’s price. For example, when a commodity price is $500,
a call option with a strike price of $400 is considered in-the-money.
- Income Dividends
- Payments to mutual fund shareholders consisting of dividends, interest
and short-term capital gains earned on the fund’s portfolio securities
after deduction of operating expenses.
- Index Fund
- A mutual fund that replicates the behavior of a given index.
- Inductive Logic
- The progress from statements describing particular events to a general
- Inefficient Markets
- Behavioral finance. Driven by frame dependence and heuristic bias, when
market prices stray from fundamental values.
- Initial Balance
- The first or first two half-hour trading periods in the CBOT Market Profile
during which prices tend to converge; the initial auction of the trading
- Initial Public Offering
- When a stock is officially available for the public to buy.
- Inside Day
A day in which the daily price range is completely within the previous
day’s daily price range.
- Interest Rate Swaps
- An arrangement that requires both sides of the transaction to make payments
to each other based on two different interest rates. The most commonly
traded requires one side to pay a fixed rate and the other to pay a floating
- Intermarket Analysis
- Observing the price movement of one market for the purpose of evaluating
a different market.
- Intrinsic Value
- The portion of an option’s premium that is represented when the
cash market price is greater than the exercise price; a known constant
equal to the difference between the strike price and underlying market
- Investment Clubs
- Small, private organizations in which a group of investors, usually novices,
pool their time and resources to learn more than they could on their own
about various forms of investments and then invest their own money as a
- Individual Retirement Account. An employer’s retirement plan that,
as specified by tax law, allows employees to elect to have their federal
taxable income be deducted and set aside for retirement.
- Irregular Flat
A type of Elliott wave correction that has a 3-3-5 wave pattern, where
the B wave terminates beyond the start of wave A. A "flat" is
in progress, implying that a larger pattern is developing. It will contain
waves of one higher degree than the A-B-C waves just completed.
- Electronic communications network.
- January Effect
- The tendency for securities prices to recover in January after tax-related
selling is completed before the year-end.
- Jumbo Certificate of Deposit
- A CD worth at least $100,000.