Blog by PriyaSahu

The PEG ratio (Price-to-Earnings-to-Growth ratio) is a tool used in stock valuation that helps investors assess if a stock is overvalued or undervalued by considering its future earnings growth rate. It is a more advanced version of the P/E (Price-to-Earnings) ratio because it factors in t...

The petrodollar system is a term that refers to the practice of trading oil in U.S. dollars. This system has a significant impact on currency markets, as the demand for dollars is driven by countries needing to purchase oil. It creates a global demand for the U.S. dollar, strengthening its...

The Pivot Point Indicator is widely used in technical analysis to determine the potential support and resistance levels for a stock, index, or market in general. It helps traders identify price levels where a market is likely to reverse or experience increased activity. Pivot points are pa...

The Price-to-Book (P/B) ratio is a simple but important financial metric used to evaluate a company's stock price relative to its book value. The P/B ratio is calculated by dividing the company’s market price per share by its book value per share. It gives investors an idea of whether the ...

The Price-to-Sales (P/S) ratio is a simple metric used by investors to evaluate a company's stock price relative to its revenue. It's calculated by dividing the company's market capitalization by its total revenue. The P/S ratio helps investors understand how much they are paying for each ...

Put skew is a term used in the options market to describe the difference in the price of put options with different strike prices. Typically, put options with lower strike prices tend to be more expensive than those with higher strike prices. This is because investors are often willing to ...

The Put-Call Ratio (PCR) is a simple tool used by investors to understand how people feel about the stock market. It compares two types of options: "puts" (which bet the market will go down) and "calls" (which bet the market will go up). By looking at the PCR, you can g...

The put/call ratio is a tool that helps assess market sentiment by comparing the number of put options to call options traded in the market. This ratio gives traders and investors insights into whether market participants are generally more bearish (pessimistic) or bullish (optimistic) abo...

The quick ratio is a financial metric used to measure a company's ability to meet its short-term obligations with its most liquid assets. It's also known as the "acid-test ratio" because it excludes less liquid assets like inventory. A quick ratio greater than 1 indicates that th...

The R-squared metric in mutual funds is a statistical measure used to evaluate how closely a fund’s performance correlates with the performance of a benchmark index, like the S&P 500. It ranges from 0 to 100, where a higher R-squared value indicates a strong correlation, suggesting tha...

The Relative Vigor Index (RVI) is a momentum oscillator used by traders to assess the strength of a trend. It is similar to the Relative Strength Index (RSI), but the RVI focuses more on the price movement’s direction rather than simply the magnitude of the price change. The RVI helps trad...

The Rising Three Methods pattern is a bullish candlestick pattern used by traders to identify potential price reversals in an uptrend. It typically forms during an established uptrend and signals that the price may continue to rise after a brief pause or consolidation. This pattern consist...

Risk-Adjusted Return on Capital (RAROC) is a financial metric used by banks and investment firms to measure the profitability of an investment or a business activity in relation to the amount of risk taken. It helps to determine whether the return is worth the risk involved. By calculating...

The Stochastic Oscillator is a momentum indicator used in trading to help identify potential price reversals by comparing a security's closing price to its price range over a set period. It helps traders spot overbought or oversold conditions in the market, indicating where price trends mi...

The Stochastic RSI (StochRSI) is a technical analysis tool used to gauge the momentum of a market trend. It is a combination of two indicators: the Stochastic Oscillator and the Relative Strength Index (RSI). This indicator helps traders identify overbought and oversold conditions in a mor...

Tape reading is an old-school technique in trading where traders analyze the ticker tape (the list of price and volume information shown in real-time) to understand market sentiment and price movement. This method allows traders to interpret the actions of large institutional investors, re...

The TED spread is a commonly used indicator in financial markets to measure credit risk. It represents the difference between the interest rates on interbank loans (LIBOR) and short-term U.S. Treasury bills. A rising TED spread indicates higher credit risk, as investors demand a higher pre...

The term structure of implied volatility refers to the changes in implied volatility over different expiration dates of options. It shows how volatility expectations vary across different time frames, helping traders understand market sentiment, pricing, and potential future price movement...

The tick size is an important concept in day trading that refers to the minimum price movement of an asset. It is the smallest increment by which the price of a security can change. In simple terms, tick size determines how much the price can move in one step, and understanding it is cruci...

The Triple Top and Triple Bottom patterns are two important chart patterns in technical analysis. These patterns help traders identify potential market reversals. The Triple Top pattern signals a reversal from an uptrend to a downtrend, while the Triple Bottom pattern signals a reversal fr...