Glossary

Annualized return
This is the measure of the return on an investment over a period of time. It is the annual return number (expressed in %) which, if used as the return each year during the specific time period, would have resulted in the total cumulative return over that same period.

Bear market
This is a extended period of time during which the stock market is in a down trend. A bear market is defined as a decline of 20% or more from a recent top. Another bear market indicator is a cross below a 200-day Moving Average .

Bearish signal
This is the indication that our Model has detected a change in the broad market trend to the down side, signifying it is time to consider going to cash, or to short the market, depending on your selected strategy.

Broad market
This is the stock market as a whole as opposed to a narrow market segment or sector. S&P500 Index would be considered a broad market index.

Bull market
This is a extended period of time during which the stock market is in an up trend. A bull market indicator is a cross above a 200-day Moving Average .

Buy and Hold
This is an investment approach consisting of buying equities and holding on to them for the long term. Based on the idea that in the long term the stock market always goes up.

Buy and Hold investing
See Buy and Hold.

Bullish signal
This is the indication that our Model has detected a change in the broad market trend to the upside, signifying it is time to consider going long, i.e. buy the market.

Close
Short for the closing price. The last value a security or an index reaches when the corresponding stock exchange closes for the day.

Closed-End Fund
A specific type of Exchange Traded Fund (ETF) which has a fixed number of shares that can cause their price to be influenced by the demand for the fund itself, and can therefore deviate substantially from the price of the underlying securities.

Compound Annual Growth Rate
This is the measure of the return on an investment over a specific period of time, usually more than one year. It is the annual return number (expressed in %) which, if used as the return each year during the specific time period, would have resulted in the total cumulative return over that specific period time.

Compounding
This is the exponential growth effect of an investment held over time with reinvested gains and interest. Frequently defined as the ability to generate returns on both the principal and on the accrued returns. Compounding is a cornerstone of a long term trading investment system.

Cumulative return
This is the total return of an investment over a specific period of time, with gains, distributions and dividends reinvested. It is calculated by compounding the gains or losses from each successive trade during the entire time period.

Current signal
This is the present Bullish, Neutral, or Bearish direction as indicated by our Model.

Double
This is the daily objective of a bullish mutual fund that seeks to achieve 200% of the daily performance of the tracked index. Buying such a bullish fund is equivalent to being long (buying) the index on full margin. On a day the index moves up 1%, such a bullish fund will seek to increase by 2%. On a day the index moves down 1%, such a fund will seek to decrease by 2% (all before fees and expenses).

Double inverse
This is the daily objective of a bearish mutual fund that seeks the daily performance of increasing in value twice as much as the tracked index declines, and decreasing in value twice as much as the index rises. Buying such a bearish fund is equivalent to being short on full margin (selling short on margin) the index. On a day the index moves up 1%, such a fund should decrease by 2%. On a day the index moves down 1%, such a fund should increase by 2% (all before fees and expenses).

E-mail notification
There are two types of e-mail notification messages we send e-mail addresses of all active subscribers: 1. The new signal notification (Bullish, Neutral, or Bearish) sent when our Model triggers a new signal. 2. The Weekly Market Update notification sent every Friday evening after the new Weekly Market Update has been posted.

ETF
See Exchange Traded Fund.

Exchange Traded Fund
This is a security that is listed on a major stock exchange, trades intra-day like any stock, and whose price fluctuates during the day as a result of offer and demand for the underlying securities. Exchange Traded Funds may be used as an investment vehicle with Tacticaltradingsignal.com.

FAQ
Frequently Asked Question.

Fundamental analysis
This is a method of evaluating securities and/or markets based solely on a company's fundamental data and/or economic indicators.

Index
This is a stock market index that is a hypothetical portfolio of securities representing a large grouping of companies. An index can be either broad or narrow and can correspond to an entire stock market exchange, country or region, or focus on a particular segment of the market. In general an index is transparent and its components are publicly disclosed. Indices are unmanaged and do not incur management fees, costs and expenses, and cannot be invested in directly.

Index ETF
This is an Exchange Traded Fund which follows a stock market index.

Index investing
This is an investment technique which consists of buying the market as a whole instead of individual stocks, in which index funds are used as investment vehicle.

Index-beating performance
The results achieved when a trading system historically outperforms stock market indices. Tacticaltradingsignal.com is designed to be such a system.

Indices
Plural of index.

Inverse
The daily objective of a bearish mutual fund that seeks the daily performance of increasing in value when the tracked index declines, and decreasing in value when the index rises. Buying such a bearish fund is equivalent to being short (selling short) the index. On a day the index moves up 1%, such a bearish fund should decrease by 1%. On a day the index moves down 1%, such a bearish fund should increase by 1% (all before fees and expenses).

Inverse correlation
A relationship between two or more things (stocks, market indices) in which a mutual influence causes them to move in opposite directions.

Leverage
The use of borrowed money or other financial instruments to potentially increase the returns of an investment.

Leveraged fund
A mutual fund which employs various financial instruments to achieve leverage in order to increase the fund's performance. Leveraged index funds generally seek to achieve a daily objective of double or double the inverse of the index they follow.

Long and Short
An investment strategy which consists of buying during up trends, and selling short or buying bearsih funds during down trends.

Long and Short with Margin
An investment strategy which consists of buying bullish leveraged funds during up trends, and selling short or buying leveraged bearish funds during down trends.

Long Only
An investment strategy which consists of buying bullish funds during up trends, and staying in cash or money market funds during down trends.

Long Only with Margin
A leveraged investment strategy which consists of buying stocks on margin or buying leveraged bullish funds during up trends, and staying in cash or money market funds during down trends.

Long or "being long"
The opposite of "short" or "bearish". To be invested in the market.

Long term investing
A type of stock market investing which focuses on long periods of time such as years instead of days, weeks, or months.

Maintenance margin
This is the minimum ratio of investor owned assets to total margin account value. The SEC requires a minimum of 25% but individual brokers can be more restrictive and require a higher margin. Failure to keep your account at the maintenance margin or above can cause the broker to issue you a margin call.

Margin
This is the ratio of borrowed funds in a margin trade. Full margin, also called 50% margin, is the maximum leverage allowed and signifies that out of every $1 invested .50 cents is borrowed money.

Margin call
A warning by the broker that an investor either needs to add more funds or liquidate some assets to bring a margin account to the minimum maintenance margin required.

Margin trading
A trading method applying leverage to an investment by investing borrowed money and your own. Margin can be used for both long and short trading. Margin gives you the ability to double the size of your investment and results in a doubling of the gains or losses of your investment.

Market Capitalization
Market Cap for short, represents the value of a company or fund expressed as the total number of outstanding shares multiplied by the price or Net Asset Value (NAV).

Market index
See Index.

Market Update
The section of our Friday Weekly Update providing our commentary on the week just past in the stock market, summarizing what the market is doing and what it means to our current signal and position.

Model
Tacticaltradingsignal.com detects changes in the broad market trend. The Model issues simple, definitive Bullish, Neutral, or Bearish signals in function of the trend.

Mutual funds
This is an investment vehicle allowing investors to purchase part of an entire portfolio of securities. Mutual fund portfolios can consist of equities, bonds or other investment securities. Funds can be actively managed or follow an index. The fund share price (NAV) fluctuates in function of the demand for the underlying securities within the fund and the fund itself, and is typically determined at the close of the day.

Nasdaq
National Association of Securities Dealers Automatic Quotation System. Nasdaq is the largest U.S. electronic stock exchange. Approximately 3,500 U.S. and International companies are listed on the exchange.

Nasdaq 100
An index that includes 100 of the largest domestic and international non-financial companies listed on the Nasdaq stock exchange. This is the index tracked by QQQQ, one investment vehicle that can be used with our strategies.

Nasdaq Composite Index
This is one of the broadest, most widely followed and quoted market indices. It includes all domestic and international based common type stocks listed on the Nasdaq Stock Market.

Nasdaq Stock Market
See Nasdaq.

NAV
See Net Asset Value.

Net Asset Value
The price of a individual mutual fund share, usually calculated at the end of the trading day.

Neutral signal
A signal designed to protect our investments when the market moves against our signal. It is defined as a 8%-15% move against our signal from the point of entry.

NYSE
New York Stock Exchange.

Open
Short for opening price. The first value a security or an index obtains when the corresponding stock exchange opens for trading each day.

Price/Earnings ratio
A measure of a company's valuation calculated as the stock price divided by the Earnings Per Share (EPS). Acronym: P/E.

QQQQ
The Nasdaq 100 index tracking stock listed on the Nasdaq market. This is one of the largest Exchange Traded Funds (ETF) and it works like a fund but trades like a stock.

Risk
The possibilities of losing money in an investment.

Risk tolerance
Measures an investor's ability to manage volatility and losses without excessive discomfort or distress.

Russell 2000
This is a U.S. stock market index composed of 2,000 small-cap companies.

S&P 500
This is a stock market index which is composed of 500 of the largest companies on the US stock market.

Security
This is a trading instrument representing ownership or debt.

Sell
This is the action of disposing of a security in exchange for cash.

Sell short
See Short selling.

Shareholder
This is an investor with an ownership interest in a publicly traded company. This extends to individuals or other entities holding shares of stock or any other security.

Short
The opposite of "being long" or owning a stock. When an investor is short, he is either in a bearish fund or owes his broker the stock that was borrowed and sold as part of a short sale.

Short covering
This is the closing of a short position. In this transaction an investor buys a stock and returns it to his broker for the borrowed stock.

Short selling
This is the opposite of "going long" or buying a stock. A transaction that consists of selling a borrowed stock in the hope the price of that stock will go down so that the shares owed the broker can be replaced at a lower cost than the owed shares, thus resulting in a gain.

Signal
The indication that our Model has detected a change in the broad market trend. Signal can be of the Bullish, Neutral, or Bearish type.

Signal update
The section of our Weekly Update bringing up to date our current signal position and performance since issued.

Stock
A type of equity security representing ownership in a corporation. It represents the holder's a claim on the corporation's assets and future earnings as well as voting rights. Individual stock can be privately held or publicly traded and can be of different types such as common and preferred.

Stock exchange
This is a company that lists corporations and supervises the exchange of their stock. Some exchanges have a physical trading location, "the floor", where traders make trades, others are entirely operated online. Examples are Amex, Nasdaq, and NYSE.

Stock market
This is composed of all the publicly traded equity securities and stock exchanges where they are traded.

Stock market index
See Index.

Stockholder
This is an individual or corporate owner of stock equity in a corporation.

Stop
See Stop-loss.

Stop-loss
This is the lowest price at which to sell a security to prevent further losses.

Stop order
This is a broker transaction implementing a stop-loss. This is a sell order which only gets executed when the price of the security declines to the specific price.

Strategy
This is a plan of action intended to help in accomplishing a specific goal. Tacticaltradingsignal.com defines 4 distinct investment strategies presenting the investor with diverse risk/reward choices.

Technical analysis
A method of evaluating securities and/or markets based entirely on past and present data such as price and volume to identify patterns that suggest possible future activity.

Ticker symbol
The characters which identify a security. Examples are QQQQ and SPY.

Trailing stop
A stop that is moved up as the price of the security moves up. A stop is the lowest price at which to sell a security to prevent further losses.

Trend
This is the predominant direction of the broad market. The trend is either up or down. Even during periods when the market seems trendless, the underlying trend remains until a change is detected by technical indicators.

Volatility
This is the measure of the amount and frequency of price variations of an index or security.

Weekly Market Update
Tacticaltradingsignal.com periodical subscriber communication vehicle. Is published every Friday evening after market close. Consists of the Current Signal, Market Update, and Technical Analysis 101.

Yearly return
This is the investment return in a given calendar year. Yearly returns represent the actual performance for the year.