Reference

Glossary

187 terms, grouped by where they show up in the curriculum. Every definition here is the same one taught in its unit; nothing redefined separately.

Money & Foundations

Asset class: A category of things that carry tradeable value; stocks, bonds, gold, real assets, cash.
Bonds / fixed income: A structured loan to a government or company that pays a fixed return.
Budget: A plan that gives every rupee of your income a job before the month starts.
Compound interest (compounding): Growth that earns its own growth: interest is added to the pile, and the next interest is worked out on the bigger pile.
Credit score: A track record of repayment behavior, not a fixed judgment of a person's worth.
Digital rupee: India's official digital currency, issued by the RBI alongside physical cash; the same job money has always done, in a new form.
Diversification: Spreading money across different things so no single wrong call sinks the whole outcome.
Emergency fund: Money set aside to protect calm decision-making during a disruption, not to grow wealth.
EMI (Equated Monthly Instalment): The fixed monthly loan payment; on its own it hides the tenure and total cost behind it.
Fixed deposit (FD): A bank deposit that locks in a rate for a set term; breaking it early can cost you.
Good debt / bad debt: Whether a loan builds future capacity or only buys present comfort.
Index fund: A mutual fund that copies a market index rather than trying to beat it, so it follows the market up and down.
Inflation: The general rise in prices over time that makes the same rupee amount buy less.
Insurance: Paying a small known amount so someone else carries a large, uncertain loss; protection, not an investment.
Liquidity: How easily and quickly something can be turned into usable cash without losing much value.
Mutual funds: A pool of many investors' money, professionally managed and invested on their behalf.
Nominal value: The face amount of money, unadjusted for inflation.
Opportunity cost: What you give up by choosing one path, measured by what the other path would have built.
Purchasing power: What your money can actually buy; as opposed to the number printed on it.
Real assets: Physical things that hold value, like property or gold.
Risk transfer: Paying a small, predictable cost (like insurance) so someone else carries a large, uncertain loss.
Savings-like instruments: Low-risk places to protect money, like FDs and savings accounts, rather than grow it.
SIP (Systematic Investment Plan): A way of investing a fixed amount in a mutual fund at regular intervals, usually every month.
Time value of money: A rupee today is worth more than the same rupee later, because it has more years to grow.

Stock Market Mechanics

Blue chip stocks: Shares of large, long-established, financially sound companies; an informal label, not a promise of safety.
Bonus shares: Extra shares given free to existing shareholders in a fixed ratio; more shares, each worth proportionately less.
Broker: Executes the buy/sell decision you've already made; it doesn't make that decision for you.
Brokerage: The fee a broker charges for carrying out your buy or sell order; taxes and other charges are added on top.
BSE (Bombay Stock Exchange): India's other major exchange, alongside NSE.
Bull market / bear market: A sustained period of rising prices and confidence, and a sustained period of falling prices and pessimism.
CDSL: India's other depository, alongside NSDL.
Delivery trading: Buying shares and holding them in your demat account beyond the day, so they are delivered to you; the opposite of an intraday trade.
Demat account: Where your shares actually rest once you own them, held electronically, separate from your broker's app.
Depository Participant (DP): A SEBI-registered bank, broker or app that opens your demat account and links it to the depositories.
ETF (Exchange-Traded Fund): A fund that holds a basket of investments, often an index, and trades on the stock exchange like a share.
Expense ratio: The yearly fee a mutual fund or ETF charges, as a percentage of the money in it, taken out of the fund's value.
FII (Foreign Institutional Investor): A large foreign entity investing in Indian markets.
IPO (Initial Public Offering): A private company selling shares of itself to the public for the first time.
KYC (Know Your Customer): The standard identity check meant to stop fraud, not a sign anything risky is happening.
Large cap / mid cap / small cap: Companies grouped by market cap: the biggest are large caps, the smallest listed ones small caps, with mid caps between.
Limit order: An order that only executes at a price you specify, or better.
Market cap (Market Capitalisation): The total market value of a company's shares: the share price multiplied by the number of shares.
Market maker: A participant whose standing willingness to buy or sell keeps trading possible.
Market order: An order to buy or sell immediately at the best available price.
NAV (Net Asset Value): The value of one unit of a mutual fund: its assets minus its liabilities, divided by the number of units.
Nifty 50: The NSE's main index, following 50 large listed companies; a measure of the market, not something you buy directly.
NSDL: One of India's two depositories; the independent electronic record-keeper of who owns which shares.
NSE (National Stock Exchange): India's exchange where the venue for buying and selling equity/derivatives sits; it hosts trading, it doesn't set prices.
Penny stocks: Very low-priced shares of tiny companies with little trading and big price swings; an informal label.
Retail investor: An individual investing their own money, as opposed to a large institution.
Rights issue: An offer to existing shareholders to buy new shares in proportion to their holding, usually at a discount to the market price.
SEBI (Securities and Exchange Board of India): The regulator that sets and enforces market rules; it doesn't buy, sell, or set prices itself.
Sensex: The BSE's main index, following 30 large listed companies; India's oldest stock index.
Settlement: The behind-the-scenes process that verifies and transfers real ownership after an order is matched.
Share: A small slice of ownership in a company.
Stock split: Each share is divided into several shares, so the price per share falls while the company's value and your holding's value stay the same.
Trading account: Where you place an order; the decision, not the ownership.
Upper circuit / lower circuit: The highest and lowest price a share may reach in one trading day, set as a band by the exchange.

Reading a Business & Financial Statements

Asset allocation: Dividing money across asset types (equity, debt, gold, cash) by percentage, decided in advance.
Assets: Everything of value a company owns.
Balance sheet: A snapshot of what a company owns and owes at one specific moment, not a record of performance over time.
Book value: Assets minus liabilities as recorded in the accounts: what the books say is left for the owners.
Cash flow statement: Tracks the actual cash moving through operating, investing, and financing activities; a truth-check on reported profit.
Concentration risk: The danger of losing heavily because too much money sits in one holding; too many holdings is its own hidden risk.
Corporate governance: How a company's leaders treat shareholders when no rule is forcing fair behavior.
Current ratio: Current Assets ÷ Current Liabilities; a signal of short-term survivability.
Debt-to-equity ratio: How much of a company is financed by debt versus owners' equity.
Dividend: A part of a company's profit paid out to its shareholders, as an amount per share; the board decides each time.
Due diligence: The careful checking of a company's business, management, moat and financials before deciding.
EBITDA: Profit from core operations before interest, tax, depreciation and amortisation; not cash flow and not net profit.
EPS (Earnings Per Share): Net profit divided by the number of shares: the profit that sits behind one share.
Equity: What's genuinely left for owners once every debt is subtracted (Assets minus Liabilities).
Ex-dividend date and record date: The record date is when the company checks who owns the share; the ex-dividend date is the first day a new buyer does not get the declared dividend.
Intrinsic value: A business's estimated true worth, independent of its current market price.
Liabilities: Everything a company owes to someone else.
Margin of safety: (Estimated Value − Price) ÷ Estimated Value; the buffer that protects you if your estimate is wrong.
Market sentiment: The shared mood of buyers and sellers, excited or fearful, that can push price away from value.
Moat / competitive advantage: Whatever makes a business hard for a competitor to copy or dislodge.
Net profit: What's left after all expenses are subtracted from revenue.
Network effect: A product becomes more valuable to each user as more people use it; a way of building a moat.
P/E ratio: Price per Share ÷ Earnings per Share; how much you're paying today for each rupee of current profit.
P&L (Profit & Loss) statement: The story of a specific period; what a company earned, spent, and kept.
Position sizing: Deciding how much to put into one holding; a separate decision from whether to invest in it at all.
Profit margin: The share of every rupee of sales a company keeps as profit; real evidence only beside companies in the same sector.
Promoter holding: The share of a company owned by its founders and top insiders; one clue about how leaders treat shareholders.
Rebalancing: Restoring a portfolio to its planned proportions by trimming what's grown and adding to what's lagged.
Receivables: Money a company is owed by customers for sales already made but not yet paid for.
Revenue: What a company earned from its actual business, before expenses.
ROE (Return on Equity): Net Profit ÷ Shareholder's Equity; how efficiently a company turns owners' money into profit.

Charts & Technical Trading

Bollinger Bands: A moving average with bands added above and below, based on how far prices typically spread from it.
Breakout: Price moving decisively past a known support or resistance level.
Candlestick: A chart symbol recording the open, high, low, and close of one time period.
Chart pattern: A visual record of repeated buyer/seller behavior at a price level (e.g. double top, head and shoulders), not a prediction.
Doji candle: A candle with almost no body, showing open and close landed near the same price; it reports only what already happened.
Double top / double bottom: Two peaks (or two troughs) near the same price that both fail to push further; a record of what the crowd did, not a forecast.
Head and shoulders pattern: Three peaks where the middle one is tallest, joined by a neckline; a record of what the crowd did, not a forecast.
Intraday trading: Buying and selling the same share within one trading day, so nothing is carried overnight.
MACD: The difference between a 12-day and 26-day EMA, used to read a shift in momentum.
Market structure: The sequence of a price's highs and lows over time, showing its current direction.
Momentum: How fast and how strongly a price has been moving in one direction recently; it describes the past, not the next move.
Moving average: The average price over a rolling window of recent periods.
Pullback: A short drop in price after a rally, within a trend that is still moving in its original direction.
Risk-reward ratio: Potential gain divided by potential loss on a trade; fixed before entering, not judged after.
RSI (Relative Strength Index): A 0-100 measure of recent average gains versus average losses; a description of momentum, not a guarantee.
Stop-loss: A pre-decided exit price that replaces in-the-moment hoping with a decision made in advance.
Support / resistance: Price levels where past buying or selling pressure has reacted before; a probability-based clue, not a wall.
Trading plan: The written rules you set for a trade before you enter it, made when you are calm; only a new fact is a reason to change it.
Uptrend / downtrend / sideways market: Price direction read from the pattern of highs and lows over time, not from a single price point.
Volume: How many shares actually traded; used to confirm or question a price move.
VWAP (Volume-Weighted Average Price): The average price weighted by how much volume traded at each level, resetting every trading day.

Derivatives & Options

Basis: The gap between a futures price and its spot price, which narrows as expiry approaches.
Breakeven point: The price at which a position neither gains nor loses money.
Call option: The right, not the obligation, to buy something at a fixed price later.
Delta: How much an option's price is expected to move for a ₹1 move in the underlying, right now.
Expiry date: The fixed date on which a contract ends and must be settled or closed.
Futures contract: An agreement made today to buy or sell something at a fixed price on a fixed future date.
Gamma: How fast an option's Delta itself changes as the underlying moves.
Gap risk / tail risk: The risk that a sudden price jump or a rare extreme move defeats an ordinary risk-management tool.
Implied volatility (IV): The market's forward-looking expectation of how much a price will move.
India VIX: A real number published daily by NSE, measuring the market's expected near-term volatility.
Intrinsic value / time value: The two components of an option's premium: real current value, plus value from time remaining.
ITM / ATM / OTM: In-, At-, or Out-of-the-Money; whether an option's strike is favorable, equal, or unfavorable versus current spot price.
Lot size: The fixed minimum quantity a contract can be traded in; set by the exchange, not negotiable.
Margin and margin call: Margin is money set aside as a buffer to hold a leveraged position, not extra spending power; a margin call is a broker's demand for more when losses eat into it.
Mark-to-market (MTM): The daily process of crediting or debiting gains/losses on an open futures position.
Option chain: A table listing calls and puts across strike prices for one underlying.
Payoff: The profit or loss at a given price, before subtracting the premium paid.
Portfolio heat: Total capital at risk across all open positions, expressed as a percentage of total capital.
Premium: The price paid for holding an option's right, separate from whether that right is ever used.
Put option: The right, not the obligation, to sell something at a fixed price later.
Realised volatility (RV): How much a price has actually already moved, looking backward.
Rollover: Deliberately closing an expiring futures position and opening a similar one in a later cycle.
Spread: Buying one option and selling another so the premiums partly offset, capping both loss and gain.
Straddle / strangle: Buying a call and a put together; a bet on the size of a move, not its direction.
Strike price: The fixed price boundary an option gives the holder the right to transact at.
Theta: The value an option loses each day purely from time passing, all else unchanged.
Tick size: The smallest allowed price step a contract can move in.
Vega: The change in an option's value for every 1-point change in implied volatility.

Professional Market Analysis

Beta: How much a share has tended to move compared with the market; 1 means in step, above 1 more, below 1 less.
Bid-ask spread: The gap between the best buy and sell price on offer; a real, comparable trading cost.
Correlation: How closely two holdings' prices move together, from fully together to fully independent.
Expected value: The probability-weighted average outcome of a repeated decision.
GDP (Gross Domestic Product): The total value of goods and services a country produces in a period; the standard measure of the size of an economy.
High-volume / low-volume node: A price zone where the crowd traded heavily, or barely traded at all, respectively.
In-sample / out-of-sample data: Data used to build a rule, versus data used to actually test it; only the second counts as real evidence.
Long buildup / short buildup / short covering / long unwinding: The four ways price and OI can move together; each meaning something different about whether a move has fresh conviction behind it.
Lookahead bias: A backtest that looks smarter than it honestly could have been, by using information not available at the time.
Maximum drawdown: The largest peak-to-trough decline a portfolio experienced along the way.
OI wall: A large Open Interest cluster at one strike, read as probable, never guaranteed, support or resistance.
Open Interest (OI): The number of outstanding, not-yet-closed derivative contracts.
Order book / market depth: The stack of waiting buy and sell orders at multiple price levels, not just the top price shown.
Overfitting: Tuning a rule so tightly to past data that it captures noise instead of a real pattern.
PCR (Put-Call Ratio): Total Put OI ÷ Total Call OI; a read of where the crowd is currently positioned.
Point of Control (POC): The single price level with the highest traded volume in a session.
Price discovery: The continuous process of buyer and seller orders being matched; this is what actually sets a price.
Repo rate: The rate at which the RBI lends short-term money to banks; its main policy rate for steering inflation and borrowing costs.
Risk-adjusted return: Return divided by volatility; judges performance per unit of risk taken, not raw return alone.
Rupee-dollar rate: How many rupees it takes to buy one US dollar, a sign of money entering or leaving India.
Sharpe ratio: Return minus a risk-free rate, divided by volatility: how much return was earned for each unit of risk taken.
Short selling: Selling first and buying back later, so you gain if the price falls; the possible loss has no upper limit.
Survivorship bias: A track record that looks better than reality because failures were quietly excluded.
Total return: A portfolio's overall gain or loss from starting to ending value.
Value Area: The price range built outward from the POC that covers roughly 70% of a session's volume.

Global Markets & Alternative Assets

Bond: A structured loan an investor gives to a government or company.
Commodity: A raw material or agricultural product, standardized enough to trade on an exchange.
Credit risk: The chance that a borrower fails to repay interest or principal in full or on time; a higher rate prices it in.
Currency pair / base currency / quote currency: How one currency's value is expressed relative to another (e.g. USD/INR = how many rupees per dollar).
Exchange rate: The price of one currency in terms of another, moving on demand and supply like any other price.
Face value / coupon / maturity: A bond's three basic terms: what it repays, what it pays annually, and when it ends.
Gold as an investment: Gold earns its place by moving differently from shares, not by being good on its own; it is held for balance, not speed.
Hedging: Taking a position to reduce the risk of an unfavourable price move elsewhere in your finances; it trades some gain for certainty.
MCX (Multi Commodity Exchange): India's exchange for trading commodities like gold, silver, and crude oil; it standardizes contracts, not prices.
REIT / InvIT: A tradeable unit representing a pooled, professionally managed share of real estate or infrastructure income.
Risk-on / risk-off: Market-wide regimes where money broadly moves toward growth assets (risk-on) or safe havens (risk-off).
S&P 500 / FTSE 100 / DAX: Scoreboard indices summarizing a basket of a country's major listed companies (US, UK, Germany respectively).
Safe-haven assets: Assets, like gold, that tend to hold or gain value when broader markets grow fearful.
Yield curve: A chart plotting yield against maturity for bonds of the same issuer; normal slopes up, inverted slopes down.

Decision-Making & Behavioral

Anchoring: Letting the first number you see become the reference point everything else gets judged against.
Confirmation bias: Noticing evidence that agrees with an existing belief while skipping evidence that doesn't.
Decision journal: A record of a decision's situation, reasoning, and expected outcome range; written before the outcome is known.
First-principles thinking: Reasoning from bedrock, verifiable facts rather than "everyone already does it this way."
Observing Self / Reacting Self: Responding to what's actually happening (Observing) versus responding to a feeling (Reacting).
Overconfidence: The gap between how sure you feel and how often you're actually right.
Pre-mortem: Asking "what would have to be true for this to turn out to be a mistake?" before deciding.
Process vs. outcome: Judging a decision by the quality of the reasoning at the time, not by how it happened to turn out.
Recency bias: Giving the most recent event outsized weight over an equally important older one.
Reversible / irreversible decision: Whether a decision can be easily undone; should set how much thinking-effort it deserves.