Stock Market Glossary
Screeners
Valuation
- P/E Ratio: A Complete GuideWhat the P/E ratio is, how to calculate it, and its limitations.
- Understanding the P/B RatioKey metric for valuing asset-heavy and financial stocks.
- How to Use the P/S RatioUsed to evaluate growth companies that are not yet profitable.
- What is the P/CF Ratio?A cash flow-based metric that avoids accounting distortions.
- EV/EBITDA Meaning and UsageA standard enterprise value multiple used in M&A.
- DCF (Discounted Cash Flow) BasicsExplaining the DCF model, the standard for intrinsic value calculation.
- PEG Ratio — Growth Stock ValuationA P/E ratio adjusted for growth, used to evaluate growth stocks.
- Forward P/E vs. Trailing P/EThe difference between P/E based on expected vs. past earnings.
Fundamental Analysis
- Interpreting ROE (Return on Equity)A key metric measuring a company's capital efficiency.
- The Difference Between ROA and ROETotal asset efficiency, including debt.
- Meaning of Operating MarginA metric that shows core business profitability at a glance.
- Gross Margin and Industry DifferencesSaaS 80% vs Retail 20% — Why the big difference?
- How to Read the Debt-to-Equity Ratio (D/E)Debt proportion relative to equity. Compare appropriate levels by industry.
- Meaning of Current RatioA short-term solvency indicator. Over 200% is considered stable.
- Understanding Free Cash Flow (FCF)Cash available for dividends, share buybacks, and M&A.
- Why is EPS Growth Important?The fundamental driver of long-term stock price appreciation.
- Dividend Yield and Dividend Growth StocksCalculating dividend yield and dividend growth investing strategies.
- Meaning of the Beta (β) CoefficientVolatility relative to the market. Distinguishes defensive vs. cyclical stocks.
- Using Insider Buy/Sell FilingsEvaluating management confidence through Form 4 filings.
- Analyzing Share BuybacksEffects of share buybacks on stock price and EPS.
Technical Analysis
- Moving Average (MA) BasicsMeaning of 5, 20, 60, 120-day MAs, and golden/death crosses.
- Reading Volatility with Bollinger BandsPractical application of standard deviation-based price channels.
- Interpreting RSI (Relative Strength Index)A key momentum indicator for identifying overbought and oversold conditions.
- How to Use the MACD IndicatorDetecting trend reversals using the difference between short and long-term MAs.
- 10 Candlestick Chart PatternsKey patterns like hammer, morning star, and long black candlestick.
- How to Draw Support and Resistance LinesVisualizing the boundaries of buying and selling psychology.
- Distinguishing Accumulation and Distribution with VolumeWhat volume tells you before price does.
- Reading Short InterestAssessing short interest levels and the potential for a short squeeze.
Trading Strategy
- Exit Strategy — Setting Target and Stop-Loss PricesHow to pre-design emotion-free selling rules.
- Criteria for Setting a Stop-Loss PriceThe principle of limiting losses. Methods include ATR, % from high.
- Position Sizing and the Kelly CriterionMathematically calculating how much to allocate to a single stock.
- Pros and Cons of Dollar-Cost Averaging (DCA)Is regular fixed-amount investing truly advantageous? A mathematical look.
- Portfolio Rebalancing FrequencyComparing monthly, quarterly, and annual rebalancing.
- Risk-Reward Ratio (R:R) and Expectancy ThinkingThe concept of risk-reward ratio, more important than win rate.
- Principles of Trend-Following TradingA systematic approach to riding long-term trends.
- Contrarian InvestingThe rationale behind buying when the majority is fearful.
- Earnings Surprise TradingStrategy for responding to quarterly earnings report events.
Portfolio
- Diversification — How Many Stocks Are Enough?Calculating the optimal number of stocks based on correlation and volatility.
- Core-Satellite StrategyDesigning a portfolio with an ETF core and individual stock satellites.
- The Current State of the 60/40 PortfolioRe-evaluating recent performance of the classic 60% stock, 40% bond strategy.
- Geographic Diversification — US, KR, Emerging MarketsOvercoming Korean home bias and global diversification ratios.
- Mixing ETFs and Individual StocksPros and cons of a hybrid active-passive strategy.
Macro
- Impact of FOMC and Policy Rates on StocksHow Fed interest rate decisions transmit to the stock market.
- What an Inverted Yield Curve MeansShort-term vs. long-term bond yield inversion and recession prediction.
- How to Interpret CPI ReleasesHeadline vs. core CPI differences and market reactions.
- Exchange Rate (USD/KRW) and Korean StocksImpact of the USD/KRW exchange rate on foreign investor flows.
- Bond Yields vs. Stock ReturnsComparing the two asset classes from an asset allocation perspective.