Terms and abbreviations used around Tiblio
Bag Holder Riding a stock up and diamond handing it all the way back down. You tried to ride a trend up, or got caught in a grind down and didn’t use stops and now it is difficult to get out.
Day Trade Any trade entered and exited in the same trading session. Stocks and options can be day traded, day trading a single spread can trigger your broker to stop trading to avoid PDT on margin accounts
DTE Days to Expiration calculated from the raw expiration year value so it is a fraction. This is the exact value that is used in the Greeks calculations.
Float Regular shares issued to the public that are available for investors to trade. In general, the larger the float the harder it is to move the price of the stock significantly and quickly.
IV The 30-day at-the-money Implied Volatility. This calculated on the bid-ask spread, the difference between the bid and the ask. The higher the IV the larger the bid-ask spread and the higher the option price will be.
Key Level This can be a support or resistance point also called a pivot point. The perspective or role of the key level depends on the particular trade. For a long trade, a key level above the current price would be considered a resistance level or breakout level. While a level under the current price would be considered a support level.
Mark The mid-point price = Bid + Ask / 2
Market Cap The value of the company as the total number of shares times the share price. This is a measure of how big a company is and may affect your trading, for example, if you choose not to trade companies with a market cap below a particular threshold.
Risk/Reward Ratio The amount risked divided by the potential profit. Calculated as the (Entry - Stop Loss) / (Profit - Entry).
Swing Trade Any trade lasting longer than a day and less than six months to a year.
PDT Pattern Day Trader - refers to buying and selling the same security in the same day. The PDT rule applies to all US margin accounts under $25,000 in total value.
Watchlist This should be a short list of stocks that you’re paying attention to for today’s trades. Isolating your list for today will help keep you focused and organized.
Strike1 and Strike2 - In the credit spreads screener Strike1 is the one you would sell and Strike2 is the one you would buy. In flow screeners it is simply the two strikes in the spread since the flow screener shows real trades, it is unknown which way it went but one of them was sold and one was purchased.
DTE Days to Expiration
IV Implied Volatility - it is implied because it is calculated from the bid / ask prices set by the market makers.
POP Probability of Profit - in Tiblio screeners this is taken as the inverse of Delta which gives a probability that the short side of the trade (if it has multiple legs) will expire worthless. This is more conservative than the real probability of profit calculation which increases the probability because it takes into account the credit you received. This term is used on the Spreads screener. On other screeners, look for the Delta column.
Delta This is a measure of how much the option moves with respect to a move in the underlying stock price. A Delta of 1 would indicate that for every $1 of stock movement, the option price will move $1. A Delta of 0.50 (Fifty Delta) is At-The-Money and indicates the option price will move $0.50 for every $1 move of the underlying stock.
PDC Prior (previous) Day Close
Spot Spot will always be a delayed price that usually matches the price of the stock at the time the calculations were done in the screener.
EPS Earnings Per Share
P/E Price-to-earnings ratio
P/B Price-to-book ratio
EBITDA Earnings Before Interest, Taxes, Depreciation, and Amortization. Commonly used as a quick way to gauge the profitability of a business.